ATLANTA-A two-store Walgreen’s portfolio in the Atlanta area has sold for $11 million. The sale of the retail buildings in Lilburn and Douglasville marks an ongoing trend: investors parking cash in deals that commercial real estate industry watchers compare to owning corporate bonds.
A private institutional commercial real estate investment group in New York City paid $395-per-square-foot in cash for the properties. The seller is an Atlanta-based preferred Walgreen’s developer.
Sean Attaway Molloy, senior director of Franklin Street Real Estate Services, represented the seller in both transactions. Molloy tells GlobeSt.com he fielded about 25 offers on the Walgreen’s portfolio. The buyer put the property under contract and closed on the deal in 40 days at a blended cap rate of about 7.65%.
“There were about 225 Walgreen’s on the market at any given time last year,” Molloy says. “Now, there are probably 100 or so. As the product dries up and demand for the security of these assets increase, cap rates are compressing. From the time we put this under contract, cap rates dropped in some locations almost 50 basis points.”
Located at 4235 Lawrenceville Highway, the Lilburn store opened in 2007. The Douglasville store is located at 3851 Chapel Hill Road and opened in 2008. The Douglasville location strayed from the prototypical Walgreen’s design and size to conform to Douglas County architectural standards. It has a mezzanine design, with black lettering and traditional lighting scapes on the fa
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