DOWNINGTOWN, PA-Delaware-based Morris Ashbridge Associates, L.P. is purchasing the 49-acre Ashbridge Square retail center here for $52 million from Beverly-Hills, CA-based Pacific Crest Holding LLC. The property at 900 East Lancaster Ave. is 386,016 square feet. Marcus & Millichap’s Kevin Boeve, VP investments, Mark Tayler, first VP investments, and Dean Zang, a VP investment managed both sides of the deal.
The buyer assumed a $38-million loan and used a 1031 exchange for the deal. “We had a power center, we have good strong tenants who are well-rated, we have a secure income stream, we had a large transaction,” notes Taylor. “But we had a loan that had to be assumed and becausec there was a loan in place, that could not be prepaid or paid off, that took a lot of the institutional buyers out of the market for this property. Because a lot of Real Estate Investment Trusts and pension funds cannot buy with debt in place.” The firm went after private investors, pitching the property on its power-center tenants.
The property houses Home Depot, Best Buy, Staples, and Bottom Dollar, plus Christmas Tree Shops, PJ Whellihan’s Pub, PLCB Store, Jo-Ann Fabrics and Crafts, Super Cuts and Tuesday Morning. There is also a pad space that can accommodate a 7,200-square-foot to 10,000-square-foot development. Boeve says that the property garnered 17 offers.
“It was a 1031 exchange, so the private investment group that bought it had sold a large property and received the proceeds of that sale and needed it to close within six months,” Taylor explains. “So there was a timing issue. We had to close within a certain timeframe. And we have the loan assumption issue, and when you have a loan assumption, the timeframe for getting the loan assumption done is ultimately controlled by the lender, not by the seller or the buyer. Because it’s the lender making the decision, the lender looking at the quality of the buyer, the lender looking at the financial statements of the buyer, etc. So we had to make sure those two timeframes coincided, because if the loan assumption could not get done within the timeframe of the buyer’s exchange, he would have lost the deal and paid a tax.”
The leases for Home Depot, Best Buy, Bottom Dollar and Christmas Tree shop are long-term and triple-net.
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