IRVINE, Calif.,November 29, 2018 – Faris Lee Investments, a leading retail advisory, and investment sales firm, has completed the sale of a 171,564-square-foot community center anchored by Ross, T.J. Maxx, Five Below, ULTA, Steinmart, and Cost Plus, in the Chicago suburb of Saint Charles, IL.
Rick Chichester, president and CEO, Donald MacLellan, senior managing partner, and Shaun Riley, senior director, with Faris Lee Investments represented the Irvine-based seller, Sabal Financial Group, LP.
The center is situated on four parcels totaling 20.46 acres and 171,564 of gross leasable area; with over 80% of the rent roll comprised of national credit tenants with long term leases. When sold, the center was 85% occupied with a remaining value add component to lease up to full stabilization.
“The center, located in a secondary market with high vacancy in the immediate trade area and a deserted regional mall across the street, was previously purchased as a distressed investment. The seller took 4 years to reposition the asset after the center became approximately half vacant providing immediate opportunity for a new investor to lease up the remaining vacancy to add value,” said MacLellan.
While metro areas of Chicago follow a trend of gentrification, low vacancies, and increasing rents, the secondary markets are generally over-retailed. With conditions modestly improving, private investors have the ability to acquire properties at an attractive cap rate relative to the overall market as with the case of Main Street Commons.
“In a time of major uncertainty and negative investor sentiment with box tenants in a secondary market, the key to a successful sale was to heavily market to private investors comfortable with the market,” said Chichester.
“Faris Lee has the retail expertise and a unique vision to maximize the value of an asset and successfully positioned the asset to achieve a cap rate 100 basis points lower than the market, exceeding our expectations,” said Phil Ramming, Retail Product Leader at Sabal Financial Group.
About Faris Lee Investments: Faris Lee Investments is a leading retail advisory and investment sales firm. The company’s high-level retail investment advisors and sophisticated financing experts develop forward-thinking strategies for all retail acquisitions and dispositions and guide clients through complex transactions. Cumulatively, Faris Lee’s leadership has been involved in more than $20 billion of transactions. Faris Lee’s senior advisors are skilled in disposition and acquisition strategies, asset positioning and valuation, marketing, debt and equity structuring, strategic workout and REO solutions and execution. For more information, visit www.farislee.com.
Faris Lee is also a strategic partner with X Team Retail Advisors, an integrated platform of retail real estate specialists that offers coverage in 40 major markets across the United States and Canada encompassing more than 265 professionals. X Team provides specialized expertise in tenant, property and developer/landlord representation, property dispositions and retail investments.