We spoke with Dillavou about the transaction, as well as how small-format Target stores have impacted shopping-center valuations.

GlobeSt.com: How have small-format Target stores helped with shopping-center valuations?

Dillavou: The Target small-format stores have been an outstanding concept to penetrate urban markets. They create a bricks-and-mortar location with flexible merchandising to complement and augment the local demographic as well as support Target's growing e-commerce business. All of this while continuing to satisfy the consumer desire for daily-needs convenience. As such, we believe these stores will continue to drive traffic from all demographics, which will drives sales volumes of co-tenants in the center.

GlobeSt.com: How are buyers distinguishing themselves in order to win high-demand Southern California shopping-center deals?

Dillavou: Liquidity and execution. We are spending more time than ever qualifying buyers up front before agreeing to sell. Buyers with numerous contingencies in their offers or who lack market credibility are going to experience increased difficulties purchasing high-quality retail assets.

GlobeSt.com: What type of retail does best in the area of Orange County where this shopping center is located?

Dillavou: This center was originally built as a neighborhood grocery-anchored shopping center. As the local demographics and consumer preferences shifted, the original grocer's sales decreased, and the shop tenants suffered. The center remains an excellent location for a neighborhood center and simply needed a new anchor and an overall aesthetic upgrade for it to once again become a vibrant shopping destination in the community.

GlobeSt.com: What else should our readers know about this transaction?

Dillavou: This transaction is an excellent example of teamwork. There are numerous stakeholders to a redevelopment that need to work together in sync in order to—within just over one year—take a dilapidated center to a vibrant new community asset. From the City moving very quickly to approve the new use and the tenants expediting lease negotiations, to the leasing brokers, A&E team and contractors hustling to fill and construct vacant spaces, we were fortunate to have a hard-working team that solved problems and was able to get tenants open quickly.

CJ Osbrink with NKF also pointed out that because there is a real lack of well-located, grocery-anchored shopping centers available for sale on the West Coast, he expects that to act as a driver for the most aggressive buyer pools and pricing in 2018 for necessity-anchored retail centers surrounded by affluent and dense demographics.