UTICA, NY-Hannaford Plaza, a 189,218-square-foot grocery-anchored shopping center in Utica, has been sold to Manhattan-based Katz Properties Inc. for $14.1 million, according to Marcus & Millichap Real Estate Investment Services, who represented the buyer as well as the seller, Hannaford Station Inc., on the deal, GlobeSt.com has learned exclusively.

The property, anchored by Hannaford’s Supermarket, went for a $74.52 per square foot and a cap rate of 9.26%, a favorable price for Upstate New York retail, says Joseph C. French, a senior director at Marcus & Millichap’s National Retail Group, who worked on the deal with M&M associate Thomas C. Dalzell.

“Even in tertiary markets, a grocery-anchored center with term is very sellable,” French tells GlobeSt.com. “It is one of the few concepts that lenders will lend on.”

The shopping center, located at 1154 Mohawk St., is home to other tenants such as Dollar Tree and Family Dollar, as well as its newest arrival, Conway, a New York City-based discount fashion chain. Conway replaces the 31,000-square-foot space left behind by AJ Wright, a bargain department store chain that was shut down by TJX Co. in 2009.

“The good news was that the AJ Wright reported good sales out of this location, and Conway happened to pick up the lease,” French says. “Locals out of the city know what Conway is, but they are not well known outside of the metropolitan area. Based on that, our buyer was comfortable because they happened to be a New York City owner, but the other thing that was important was that he was comfortable because of the sales that the AJ Wright did before.”

French says a number of large private investors presented qualified offers for the property, but a traditional lender provided an out-of-area investor with acquisition financing because of the property’s promise of stabilized long-term returns.

“The interest level was high,” he says. “We had plenty of buyers, but what’s really going to get the market going again is when lenders reduce their restrictions on loan qualifications.”

And with several other deals in the pipeline, French anticipates that supermarket-anchored retail in secondary- and tertiary- Northeast markets will remain competitive.

“The market in Upstate New York is alive and well, and particularly, grocery-anchored centers are definitely alive and well,” he says. “There are many buyers actively looking to purchase.”