MIAMI-Kendall Hammocks Shopping Center has traded for about $10.2 million. In an interesting twist, the buyer assumed a securitized loan on a portion of the property and paid cash for the balance through two separate entities.
Bilzin Sumberg partner Adam Lustig represented 157th Kendall LLC and 157th Kendall 2, LLC in the acquisition of a shopping center known located at 157th Ave. and Kendall Dr. Lustig had worked on the transaction since December 2010, handling the real estate aspect, while Bilzin’s Serge Pavluk and Andy Mendoza worked on the corporate side of the deal.
“Defeasance costs were cost-prohibitive, so my client had to assume the existing loan on a portion of the property,” Lustig tells GlobeSt.com. “The loan was only on the Babies "R" Us building. The rest of the shopping center was owned by a different entity and was not subject to the loan. So the acquisition was bifurcated.”
Lustig says although this deal was somewhat unique with the bifurcation twist, he’s witnessing a recent uptick in acquisitions, and acquisitions where buyers assume the CMBS debt. He has also seen growth in retail leasing activity, which is playing a role in sales. But a fuller recovery is still in the distance.
“Because portion of the property was bought all cash and the balance was bought with an assumed loan, you still had a fair amount of equity going into the Kendall Hammocks deal,” Lustig says. “But trading remains a challenge in the market where financing is still difficult. As we see the financing market loosen up, we will see an increase in transactional activity.”
Kendall Hammocks was built in 1985. There are currently only two spaces available that have been vacant for 20 days. Space in the plaza is leasing for about $24 per square foot.
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