CHESTERTOWN, MD-A newly-constructed Walgreens here has tradedfor $7 million, at a 7.85% cap on current income. The seller is anLLC related to DMS Development of Towson, MD, while the buyer is701 Washington Avenue LLC, which represents the interests of theNew Jersey-based Tsavola family, according to Dean Zang in thePhiladelphia office of Marcus & Millichap.

Zang and and Mark Taylor represented the seller, while LoriSchneider of Marcus & Millichap’s Fort Lauderdale officeprocured the buyer. Ramon Kochavi, broker of record in Maryland forMarcus & Millichap assisted with the transaction.

Newly-constructed after being relocated from a former HappyHarry’s location one mile away, the Walgreens--located atWashington Avenue and Morgenec Road--commenced rent in August 2009on a new 25-year absolute net lease. Walgreens has madearchitectural upgrades to the exterior so it blends in with thesmall town storefronts--a requirement of the town. The location waswhat sold the purchaser, which had been seeking an investmentspecifically on Maryland’s Eastern shore, Zang says. Others buyershad dismissed the location because of the thin population density.But pairing the right asset with the right buyer resulted in astrong cap rate.

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Erika Morphy

Erika Morphy has been writing about commercial real estate at for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.