Long Beach, CA – May 2020, Centers Business Management (CBM) completed the sale of a fully-leased, six-unit retail strip center on a busy intersection in the city of Long Beach
CBM Valley Division Director, Dave O’Connell, recently completed the sale of a corner retail strip center at the intersection of 7th Street and Redondo Avenue in central Long Beach. Representing the landlord, Mr. O’Connell sold the property at full price — $5,700,000 — in a multiple offer scenario, trading the net leased asset at a very aggressive 5.2% cap rate.
The approximately 8,370 SQFT, six-unit neighborhood shopping center is situated on a 23,373 SQFT lot amid Long Beach’s premier retail trade area. Professionally managed by CBM, the well-maintained, recently remodeled is fully-leased, with five A+ national credit tenants, including Starbucks, Supercuts, The UPS Store, H&R Block, and WingStop, in addition to popular area eatery, 39 Degrees Sushi.
“As ‘Big Box’ retailers continue to contract or cease operations altogether, investors are increasingly seeking triple net leased strip center assets,” says CBM’s Dave O’Connell. “Most strip center properties host a balanced mix of restaurant and service-oriented businesses,” O’Connell notes, making them, as he terms it “Amazon-proof.” And many of these assets are also “recession-proof,” which, according to O’Connell, is the case with this property: “Regardless of the state of the economy, haircuts, tax prep, and package shipping are still in-demand services. And besides that, who doesn’t love sushi?” O’Connell adds with a wink. The “Amazon” and “recession” resistant factors, combined with a slate of national credit tenants, made this property a very desirable asset. A fact confirmed by the multiple offer submissions and aggressive cap rate the sale ultimately achieved.
O’Connell was also able to complete the deal despite some unique financing challenges. “Due to clauses in the seller’s original loan, assuming that loan was a MUST for any prospective buyer,” O’Connell says. And assumption requirements mandated a 65% down payment. No small sum considering the property’s $5.7 million price tag. “Fortunately, an exchange buyer recognized the asset’s exceptional value and had the ready cash to make the deal,” O’Connell adds underscoring the transaction’s fortuitous finale.
“There’s no question retail is evolving,” says CBM President, Rick Rivera, but despite this evolution “investors still have a strong appetite for quality assets.” And this site “fully leased to top tier credit tenants in a desirable location” is, according to Rivera: “A prime example of a quality retail property investment.”
For more information about CBM and their retail brokerage, leasing, and property management services, please contact: Rick Rivera 310.575.1517 x201 | firstname.lastname@example.org.