PHOENIX—Faris Lee Investments has completed the $22 million sale of Watson Marketplace, a fully leased, 90,000-square-foot retail center located in Buckeye, a growing submarket 30 minutes west of Phoenix.
Chris Tramontano, Matthew Mousavi, and Patrick Luther of Faris Lee Investments represented the seller and developer of the property, Scottsdale-based Desert Troon Companies. Chris Tramontano and Tom Chichester, also of Faris Lee Investments, represented the all-cash buyer, San Diego-based Interstate Holdings, who was in a 1031 Exchange. The transaction closed at a 6.8 percent cap rate.
The transaction included 55,153 square feet of property on nearly eight acres that is leased to 15 national credit and regional tenants including the anchor, Goodwill, along with Denny's, The UPS Store, Dunkin Donuts with drive-thru, and Firehouse Subs in seven separate free-standing pad buildings. It also included two retail pads ground-leased to a 5,250-square-foot McDonald's, which is on 1.22 acres, and a 4,583-square-foot Bank of America, which is on 1.0 acres.
“Faris Lee implemented a break-up strategy for the property,” says Tramontano. “Marketing the anchored portion of the center and the two ground-leased retail pads individually would maximize value and meet the seller's objective of selling the entire project this year. We secured several strong offers, particularly for the McDonald's and Bank of America pads, which were in the low 4 percent cap rate range. However, the San Diego buyer required a larger transaction as part of the upleg of its 1031 Exchange. Because of this, we negotiated an attractive, all-cash offer with an aggressive blended cap rate for the entire center. The seller benefitted from a short escrow term, and the buyer's acquisition requirements were met.”
Tramontano adds that Faris Lee aggressively marketed the property to its proprietary investor database with a particular focus on outreach to California buyers. “The pent up demand from capital in the state of California is astounding,” he says. “With competition fierce and price-per-square-foot levels at historical highs for California assets, investors are seeking out-of-state opportunities in growing markets.”
Located at 441 - 733 S. Watson Road, Watson Marketplace is positioned within the major retail corridor along south Watson Road, which features a large monument sign at the on/off ramp to Interstate 10 – the main artery leading to and from Phoenix. Additionally, the property is situated across the street from Sundance Towne Center, consisting of many high profile tenants including, Lowe's, Walmart Supercenter, PetsMart and Walgreens. The City of Buckeye is in a strong growth mode as the economy recovers and currently has more than $1 billion in public and private projects under construction or planned in the city.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
