Faris Lee Investments Completes Sale of Box Tenant
Irvine, Calif., December 9, 2018 – Faris Lee Investments, a leading retail advisory, and investment sales firm, has completed $6.8 million sale of Big Lots, Dollar Tree, and Harbor Freight Tools, 3-tenant NNN Investment totaling approximately 62,500-square-foot in Tulare, CA.
The Tenants, located in the Tulare Pavilion Shopping Center co-anchored by Ross and dd’s Discounts, are situated in one of the primary core retail corridor in the area, adjacent to the Tulare Outlet Center and close to the Highway 99 giving the retailers a national draw.
Jeff Conover, Senior Managing Director and Donald MacLellan, Senior Managing Director with Faris Lee Investments represented the Central California seller, Hillman Tulare LLC.
The property was a former Kmart, vacant at the initial acquisition. The seller back-filled the center with the three new box tenants and utilized Faris Lee Investments to position and market the property for sale.
“The property, even though located in a secondary market with junior box anchored tenants with termination rights, benefits from the close outlet mall proximity as well as recent senior living and multifamily developments nearby the trade area,” said Conover.
According to Tulare city officials, there is a rise in the number of home building permits pulled, and as a result, they’re receiving increased interest from chain retailers to move in the area. The projected retail sales growth is expected to reach 6.9% through 2022, with job growth of 5.8%, and personal income growth of 15.6%. Only a few hours away from San Francisco, Los Angeles, Las Vegas, and the California Central Coast, Tulare could be an outlet for young families looking for more affordable housing that big cities can’t offer due to low inventory and fast-rising prices.
“In a time of major uncertainty and negative sentiment with box tenants especially in a secondary market, the key to this successful sale was to mass market to private investors comfortable with this trade area,” said Conover.
“This investment priced well below replacement cost presented for the investor an opportunity to take advantage of new financing leveraging into very favorable return as the property was offered free and clear of existing debt,” said MacLellan.
Through its 1031 exchange poll of buyers and brokers, Faris Lee Investments was able to procure an all-cash buyer from Southern California willing to invest in the Central Valley and purchase an un-popular investment segment. The investor saw the intrinsic value of the real-estate location and the low rents to mitigate any risk for the lower return.
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.