IRVINE, Calif.,– Faris Lee Investments has completed the $22 million sale of Watson Marketplace, a fully leased, 90,000-square-foot retail center located in Buckeye, Ariz., a growing submarket 30 minutes west of Phoenix.
Chris Tramontano, Matthew Mousavi, and Patrick Luther of Faris Lee Investments represented the seller and developer of the property, Scottsdale-based Desert Troon Companies. Chris Tramontano and Tom Chichester, also of Faris Lee Investments, represented the all-cash buyer, San Diego-based Interstate Holdings, who was in a 1031 Exchange.
The transaction included 55,153 square feet of property on nearly eight acres that is leased to 15 national credit and regional tenants including the anchor, Goodwill, along with Denny’s, The UPS Store, Dunkin Donuts with drive-thru, and Firehouse Subs in seven separate free-standing pad buildings. It also included two retail pads ground-leased to a 5,250 square foot McDonald’s, which is on 1.22 acres, and a 4,583 square foot Bank of America, which is on 1.0 acres.
“Faris Lee implemented a break up strategy for the property,” stated Tramontano. “Marketing the anchored portion of the center and the two ground-leased retail pads individually would maximize value and meet the seller’s objective of selling the entire project this year. We secured several strong offers, particularly for the McDonald’s and Bank of America pads, which were in the low 4 percent cap rate range. However, the San Diego buyer required a larger transaction as part of the upleg of its 1031 Exchange. Because of this, we negotiated an attractive, all-cash offer with a very aggressive blended cap rate for the entire center. The seller benefitted from a short escrow term, and the buyer’s acquisition requirements were met.”
Tramontano added that Faris Lee aggressively marketed the property to its proprietary investor database with a particular focus on outreach to California buyers. “The pent up demand from capital in the state of California is astounding,” he said. “With competition fierce and price-per-square-foot levels at historical highs for California assets, investors are seeking out-of-state opportunities in growing markets.”
Located at 441 – 733 S. Watson Road, Watson Marketplace is ideally positioned within the major retail corridor along S. Watson Road, which features a large monument sign at the on/off ramp to Interstate 10 – the main artery leading to and from Phoenix. Additionally, the property is situated across the street from Sundance Towne Center, consisting of many high profile tenants including, Lowe’s, Walmart Supercenter, PetsMart and Walgreens. The City of Buckeye is in a strong growth mode as the economy recovers and currently has more than $1 billion in public and private projects under construction or planned in the city.
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.