SANTA ANA, CA—CBRE's National Retail Investment Group – West (NRIG-West) team has completed the sale of McCalla Centre, a 110,620-square-foot neighborhood shopping center in the city of Santa Ana, anchored by a high-performing Northgate Market and CVS/pharmacy, along with a synergistic mix of retail and shop tenants. The sale price was $31.8 million, representing a 3.76% cap rate on high occupancy.
CBRE's retail investment experts including VP Philip Voorhees, and team members James Slusher, Megan Wood, Brad Rable, Matt Burson and John Read represented the seller, an Orange County-based private investor partnership and the center's original developer. The buyer, also represented by Voorhees and the NRIG-West team, was a San Diego-based private real estate investment fund manager.
Built in 1986, McCalla Centre is located on 8.72 acres at 230 N. Harbor Boulevard, near West First Street. The shopping center was 97% occupied at the time.
"McCalla Centre possesses the extremely solid real estate fundamentals all seasoned investors covet and pursue: a densely populated, infill Orange County location, low anchor lease rates providing tremendous embedded value and creating a future upside, and like Northgate Market, many of the tenants perform at high sales volumes," said Voorhees.
According to Voorhees, the CBRE team's marketing system distributed more than 384 offering memoranda to investors and brokers, and through the team's "managed bid" offer process, generated more than 14 offers to purchase the property. The purchase price exceeded CBRE's pricing guidance to the ownership.
"At McCalla Centre, pricing surpassed seller expectations," said Voorhees. "And, the purchaser will be an excellent steward of this asset for years to come. This was a wonderful execution for all parties.
"We are at an unusual point in the market that favors sellers and buyers alike. Sellers garner record low cap rates (as is the case with McCalla Centre), and buyers enjoy historically wide spreads between cap rates and the 10-Year Treasury yield, providing high leveraged cash-on-cash returns," Voorhees told GlobeSt.
With this closing, CBRE's NRIG-West team has closed 162 transactions since the start of 2012 for a total consideration of $3.0 billion. In total, the NRIG-West team has listed and sold more than $9.0 billion in retail transactions. Select NRIG-West team California listings include Santa Maria Town Center in Santa Maria, listed for sale for $34.3 million; Stonecreek Plaza in Los Banos, listed for sale for $13.3 million; and Kalmia Plaza in Murrieta, offered for sale for $7.6 million.
The NRIG-West team focuses exclusively on retail investment properties in the western states (including CA, OR, WA, ID, NV, MT, WY, UT, AZ, NM and HI). The team's ability to collaborate across CBRE's multi-discipline platform enhances the team's role as strategic advisors to Western U.S. clients in the disposition and acquisition of retail properties, and ensures the delivery of superior results in today's investment market.
CBRE Group, Inc., a Fortune 500 and S&P 500 company headquartered in Los Angeles, is the world's largest commercial real estate services and investment firm (in terms of 2013 revenue).
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