Retail Investment Sales Advisory Transaction of a Sprouts In California

IRVINE, Calif., November 28, 2022 - Faris Lee Investments, a leading retail advisory, and investment sales firm announced the single-tenant net leased sale of a Sprouts Farmers Market in Folsom, CA. The grocery store was part of The Bidwell Center, near the Mercy Hospital, Folsom Middle School, Lembi Park, Kohl’s, Walmart, and 24-Hour Fitness. The sale price was $11.30 million, representing a 5.45 percent cap rate, one of the lowest cap rates for a single-tenant grocery store in Northern California, according to CoStar.

Faris Lee Principals, Jeff Conover, Shaun Riley, and senior managing director Scott DeYoung represented the seller, VR Folsom, LLC, a private family office based in Orange County, CA. The buyer from La Jolla, CA, in a 1031 exchange, was represented by Infinity Investment Properties, Inc.

The Opportunity

The property is located at 905 E. Bidwell St. and sits on a 2.70-acre parcel at a high-trafficked retail location adjacent to Target, Lowe’s, and Trader Joe’s. The tenant had a 15-year triple net lease with 10 years remaining and rental increases providing investors with a growing cash flow and a hedge against inflation. The property was part of a larger center including Planet Fitness and Petco.

Faris Lee's marketing strategy focused on the single-tenant credit investment and highlighted how the property would operate as a management-free asset with a new condo map intact.

“Since Sprouts occupies only a portion of a former OSH Warehouse, the Faris Lee team had to craft and finalize a condo map to divide and portion-off the excess 15,000 square foot while negotiating the sale terms and getting the deal closed,” said Jeff Conover.

The Result

Faris Lee targeted private investors in 1031 exchanges resulting in several offers throughout the marketing period. The transaction closed with an all-cash 1031 exchange buyer from San Diego County.

“Bifurcating the asset was complex with creating a proposed parcel map and working through CC&Rs, all during a short 30 day escrow period. It was really a team effort to meet the goals of both seller and buyer in this transaction.” said Shaun Riley.

About Faris Lee Investments:

Faris Lee Investments is a national leading retail advisory and investment sales firm. The company’s high-level retail investment advisors develop forward-thinking strategies for all retail acquisitions and dispositions and guide clients through complex transactions. Through its recent strategic affiliation with X-Team Retail Advisors, a nationwide partnership of seasoned retail leasing experts, Faris Lee offers a fully integrated platform with disciplined expertise in landlord leasing, tenant representation, and investment sales to maximize value for clients.

Media Coverage:

Faris Lee Arranges $11M Sale of Sacramento Net-Leased Sprouts

Faris Lee Brokers $11.3M Sale of Sprouts-Occupied Retail Property in Folsom, California