ALEXANDRIA, VA-A 14,469-square foot, 24-hour Walgreens drugstore has traded here for $10.5 million, or $731 per square foot. Dean Zang and Mark Taylor, vice presidents investments in Marcus & Millichap Real Estate Investment Services’ Philadelphia office, represented the seller, PACE-Beacon Hill LLC. Phil Sambazis, in the firm’s San Diego office, represented the buyer, a New York-based private investor. David Feldman in the firm’s Washington, DC office also provided representation. The sale of this Walgreens, located at 6717 Richmond Highway, marks the sixth DC area Walgreens drugstore sale Zang and Taylor have brokered since May.

There were four different local and national development companies involved, but one trend remained constant throughout these deals, Zang tells GlobeSt.com: cap rates rapidly compressed for a variety of reason when a top-tier credit tenant was involved. These reasons include improved and increasing financing sources, a lower yield environment for alternative investments and growing demand for such properties by 1031 buyers, private REITs and individual investors.

The Alexandria property traded at a 7.3% “and change” cap rate. Zang points to a similar trade this summer--a 14,469-square-foot Walgreens at Boswell Avenue and Richmond Highway in Alexandria for  $7.9 million, or $546 per square foot. That deal closed at a 7.5% cap rate. “The market is moving very quickly and in favor of sellers,” he says. 

Other recent area transactions include: a 14,820-square-foot Walgreens at 5585 Twin Knolls Rd. in Columbia, MD, which sold for  $6 million, or $410 per square foot; 326-328 Amherst St. in Winchester, VA, a 13,200-square-foot building that traded for $5.8 million, or $444 per square foot; 6400 Hoadly Rd. in Manassas, VA, which traded for $7.6 million; and 498 Ritchie Highway in Severna Park, MD, a 14,784-square-foot building that sold for $9.5 million, or $645 per square foot.