Stabilized Core and Value-Add's Closing Gap

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LOS ANGELES—In an exclusive GlobeSt.com interview with Alex Kozakov and Patrick Wade, first vice presidents with CBRE and co-leaders of a retail investment sales team based in Downtown Los Angeles, the team discusses the increasing convergence in pricing between stabilized core and value-added retail assets. The team tells GlobeSt.com that in the past, they have seen a much larger cap rate spread between stabilized retail assets and those that present an opportunity for the buyer to add value. Over the last few quarters, however, they have noticed a narrowing of the gap between the cap rates and prices per foot for these assets. As a result, owners of “troubled” or value-add properties are receiving similar prices to owners of stabilized properties.