Irvine, CA - April 27, 2023 - Faris Lee Investments, a leading retail advisory, and investment sales firm, has completed the $23.5 million sale of a community center, The Marketplace, in Flagstaff, AZ.
Don MacLellan, along with Jeff Conover & Scott DeYoung at Faris Lee Investments represented the seller, Macerich in the transaction which was purchased by an all cash 1031 investor from northern California.
Located in a leading retail destination, the 268,000-square-foot property boasts a strong industry presence and long-term occupancy with recent tenant renewals. Approximately 85% of the tenants have been in the center for at least 10 years, demonstrating the stability and loyalty of the retail community in this area.
The center is comprised of a mix of daily needs, home improvement, and discount retailers, making it an attractive destination for shoppers. Home Depot, the Home Improvement leader, built its building at the center, while daily-needs tenants include Petco, Best Buy, and World Market. Discount retailers like Marshall's, Old Navy, Bealls Outlet, and Tuesday Morning also have a presence in the center.
The center had a favorable long-term ground lease with the state of Arizona. “The leasehold position allowed the investor 100% depreciation on the investment, excluding Home Depot. Moreover, investors could purchase the property well below replacement cost at $99 per square foot. This lower cost basis allows investors a competitive advantage over a new product that requires above-market rents to make economic sense. These features made it an attractive option for those seeking long-term, reliable returns on their investment,” said Don MacLellan.
Because of these factors, Faris Lee Investments was able to generate significant interest and offer activity . Despite the Tuesday Morning bankruptcy during escrow, the marketing team was able to navigate the challenge and close within the needed escrow timeframes.
The Flagstaff market area is fundamentally strong, with a thriving trade area that caters to young professionals and families. The area has been ranked as the #1 Best Place for Young Professionals in Coconino County, making it an ideal location for retail businesses that cater to this demographic.
Additionally, the center is located in the most dynamic sub-market in Flagstaff, providing easy access to a large customer base and a highly visible location for retailers. The institutional quality construction of the center makes it easy to manage, with features such as ample parking, clear signage, and well-designed storefronts that attract customers.
About Faris Lee Investments:
Faris Lee Investments is a retail brokerage advisory firm founded in 1996 and is based in Irvine, California. The firm specializes in commercial real estate investment sales, brokerage, and advisory services. In addition, the firm provides a national marketing platform of properties for sale, asset appraisal, property valuation, debt structuring, negotiation, market research, and analysis services. Faris Lee combines underwriting and research that exceeds industry standards with a marketing strategy to transform investment potential, enhance value and provide their clients the competitive advantage needed when making investment decisions. The firm also serves as institutional advisors in the areas of acquisitions and dispositions, merchant banking, distressed asset disposition, private equity, and corporate sale-leaseback. For more information, visit www.farislee.com
Faris Lee Arranges Sale of 268,000 SF Shopping Center in Flagstaff, Arizona