A 45k sf, single-tenant retail property in Goodyear, AZ sold for $12 mil ($267/sf). The property is occupied by LA Fitness on a NNN-basis. The buyer, a private family trust from Los Angeles, was in a 1031 exchange up-leg with a property out of California and placed a small loan on the asset to cover debt as part of its 1031 exchange. The closing cap rate was 6.8 percent.
LA Fitness is on a long-term 15-year lease with approximately 11 years remaining on its initial term. Built in 2009, the property is located at 1382 South Cotton Lane at the signalized hard corner intersection of South Cotton Lane and West Yuma Road and near Interstate 10. The asset offers unobstructed street visibility with monument signage.
The LA Fitness property is located in a thriving area retail corridor. It is near Canyon Trails Town Center, a 435k sf power center with such tenants as Target, World Market, PetSmart, Fry’s, Dollar Tree, and Famous Footwear. It is the only fitness center within a three-mile radius which has a population of more than 34,000 residents.
Chris Tramontano, Patrick Luther and Matthew Mousavi of Faris Lee Investments represented the seller, DTD – Devco 9, LLC, out of Scottsdale AZ. The buyer was repped by Republic Commercial Real Estate.
Faris Lee’s marketing efforts for the property highlighted the strong credit tenant with a corporate lease guarantee. The property was marketed primarily to private, out-of-state buyers with a particular focus on California investors, according to Mousavi. The campaign generated more than 10 offers, from institutional and private investors.