IRVINE, CA-GlobeSt.com has learned exclusively that locally based retail investment advisory firm Faris Lee Investments has completed the sales of six Walgreens-occupied properties in less than 60 days. Five of the transactions closed off-market, while the sixth was a regular market sale.
The five properties purchased in all-cash, off-market transactions were sold by a private owner from Denver to an East Coast-based private buyer and totaled nearly $26.5 million. The properties included:
- 9307 Lee Highway in Ooltewah, TN
- 5104 Bobb Hicks Hwy. in Johnson City, TN
- 668 Main St. in Abingdon, VA
- 2191 Whiskey Rd. in Aiken, SC
- 302 University Pl. in Durant, OK
The sixth property, a regular market sale of 2008 W. Palma Vista Dr. in Palmview, TX, was sold for $6.82 million by Dallas-based McClure Partners to LCW Palmview LLC, a private all-cash buyer.
Faris Lee's Matt Mousavi, who along with Patrick Lutherrepresented both the buyers and sellers in the six transactions, tells GlobeSt.com that the Palmview property was a pre-sale development and that the firm was able to procure the buyer during its pre-sale marketing process. “We transacted a large amount of pre-development sales during the peak of the market in the last real estate cycle, and it's an important piece of their business for developers of net leased retail. It's important for them to find a buyer prior to the tenant opening for business, which presents a challenge as the tenant hasn't taken possession of the property in many cases, there's no rent being paid, and they don't yet have a certificate of occupancy. We structure the pre-sale primarily for the benefit of the seller, and this allows the buyer to purchase a new property with a brand new lease. It takes a unique marketing strategy and transaction structuring up front to execute this business plan.”
Mousavi adds that Faris Lee has access to both private and institutional capital, which creates an open bidding atmosphere. “These transactions were all record-breaking cap rates—in the low 6%, which typically would be closer to a 7 cap in some of these markets. It's a sizable transaction, but private-market pricing is key.”
As GlobeSt.com previously reported, Dennis Vaccaro, senior managing director of Faris Lee, recently organized a Union Bank-occupied property sale as a single-tenant transaction and arranged carry-back financing for the shops property sale within La Habra Town Center in La Habra, CA, to help maximize profitability for the seller. The two properties within the center were sold to two different buyers as part of a break-up strategy by owner/developer La Habra Town Center LLC of Newport Beach, CA.
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Carrie Rossenfeld
Carrie Rossenfeld is a reporter for the San Diego and Orange County markets on GlobeSt.com and a contributor to Real Estate Forum. She was a trade-magazine and newsletter editor in New York City before moving to Southern California to become a freelance writer and editor for magazines, books and websites. Rossenfeld has written extensively on topics including commercial real estate, running a medical practice, intellectual-property licensing and giftware. She has edited books about profiting from real estate and has ghostwritten a book about starting a home-based business.
