PHOENIX—Faris Lee Investments has completed the$22 million sale of Watson Marketplace, a fully leased,90,000-square-foot retail center located in Buckeye, a growingsubmarket 30 minutes west of Phoenix.

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Chris Tramontano, MatthewMousavi, and Patrick Luther of Faris LeeInvestments represented the seller and developer of the property,Scottsdale-based Desert Troon Companies. ChrisTramontano and Tom Chichester, also of Faris LeeInvestments, represented the all-cash buyer, San Diego-basedInterstate Holdings, who was in a 1031 Exchange.The transaction closed at a 6.8 percent cap rate.

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The transaction included 55,153 square feet of property onnearly eight acres that is leased to 15 national credit andregional tenants including the anchor, Goodwill, along withDenny's, The UPS Store, Dunkin Donuts with drive-thru, andFirehouse Subs in seven separate free-standing pad buildings. Italso included two retail pads ground-leased to a 5,250-square-footMcDonald's, which is on 1.22 acres, and a 4,583-square-foot Bank ofAmerica, which is on 1.0 acres.

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“Faris Lee implemented a break-up strategy for the property,”says Tramontano. “Marketing the anchored portion of the center andthe two ground-leased retail pads individually would maximize valueand meet the seller's objective of selling the entire project thisyear. We secured several strong offers, particularly for theMcDonald's and Bank of America pads, which were in the low 4percent cap rate range. However, the San Diego buyer required alarger transaction as part of the upleg of its 1031 Exchange.Because of this, we negotiated an attractive, all-cash offer withan aggressive blended cap rate for the entire center. The sellerbenefitted from a short escrow term, and the buyer's acquisitionrequirements were met.”

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Tramontano adds that Faris Lee aggressively marketed theproperty to its proprietary investor database with a particularfocus on outreach to California buyers. “The pent up demand fromcapital in the state of California is astounding,” he says. “Withcompetition fierce and price-per-square-foot levels at historicalhighs for California assets, investors are seeking out-of-stateopportunities in growing markets.”

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Located at 441 - 733 S. Watson Road, Watson Marketplace ispositioned within the major retail corridor along south WatsonRoad, which features a large monument sign at the on/off ramp toInterstate 10 – the main artery leading to and from Phoenix.Additionally, the property is situated across the street fromSundance Towne Center, consisting of many high profile tenantsincluding, Lowe's, Walmart Supercenter, PetsMart andWalgreens. The City of Buckeye is in a strong growth mode asthe economy recovers and currently has more than $1 billion inpublic and private projects under construction or planned in thecity.

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