SUNRISE, FL-Global Fund Investments and MMG Equity Partners have acquired the title to the Village Shoppes at Pine Plaza, a 234,169-square-foot shopping center in Sunrise. The investors bought the notes from Compass Bank for an undisclosed amount after foreclosing on the property.
The transaction is the largest recent shopping center foreclosure to occur in South Florida. SCP-Capri, an affiliate of Stiles Capital Partners, acquired The Village Shoppes at Pine Plaza for $24 million in 2007. Compass Bank filed a $17.3 million foreclosure lawsuit against SCP-Capri in December 2009.
Located at 4151 and 4121 N. Pine Island Rd., the shopping center is anchored by Winn-Dixie Supermarket, Sunrise Cinemas, and Family Dollar. The shopping center was close to 100 percent occupied before Hurricane Wilma, which damaged the property. The shopping center has since been repaired but did not recover its tenant base after the storm. It is only 65% occupied.
“We are in the process now of extending some leases,” Gabriel Navarro, principal of MMG Equity, tells GlobeSt.com. “The bigger opportunity lies in the lease up. There’s about 80,000 feet of vacancy. We bought in at an attractive basis where we can be successful in the lease up.”
Although the Village Shoppes at Pine Plaza is a well-anchored, high traffic shopping center, Navarro admits high vacancy rates can scare off retailers. As he sees it, part of the challenge is the center’s 35% vacancy rate. His goal is to return the property to 95% occupancy by filling about 80,000 square feet of retail space.
That may be a challenge in the short-term, given Broward County’s aching retail market. According to Marcus & Millichap, retail vacancy rates could rise to 13 percent in 2010 on the back of slowed retail expansion.
David Moret, a partner at Continental Real Estate Companies, sold The Village Shoppes at Pine Plaza in 1998. He tells GlobeSt.com that MMG Equity Partners and Global Fund Investments are astute real estate investors and operators who got an attractive price on the foreclosure.
“There’s definitely demand,” Moret says. “While there are some challenges based on the size and the configuration of the shopping center, it’s still a quality location in a Central Broward market—and one that can do well with the right basis. I’m sure this group will be able to inject new life into the shopping center.”
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