SCOTTSDALE, AZ-The unanchored 35,083-sf Palo Verde Square on the highly desirable north side has changed hands, with an Encino, CA partnership putting up $8.6 million for the 91%-leased center.
The new owners, Aric Browne and Ethan Christopher, plan to lease the balance of the shopping center at 10953 N. Frank Lloyd Wright Blvd. and hold it long term, according to Sanford Burstyn senior investment associate and director of the national retail group for Marcus & Millichap Real Estate Investment Brokerage Co.'s Phoenix office.
Burstyn, the deal's sole broker, says the eight-year-old center has good upside potential. "The area is pretty much built out of retail so there are all kinds of barriers to entry there," Burstyn tells GlobeSt.com. "The barriers to entry are a formula for success. The location is absolutely fantastic."
Burstyn negotiated the sale for the buyer and seller, Palo Verde Square Shopping Center LLC of Scottsdale, which developed the center in 1998. The developer owns office buildings in the region, but Palo Verde Square was its last retail property in Scottsdale.
Burstyn says the listing was marketed for five months, attracting 15 offers. The buyer got the nod for purchase because it understood both the market and the property. "There isn't a lot of credit in the rent roll, mostly local and neighborhood tenants," Burstyn says. "The buyer owns a lot of properties like this one, had experience with it and that's what was appealing to the seller."
The lead tenant, Tuesday Morning, has a July 2007 lease expiration with two five-year options for renewal. Burstyn says other rolls offer good upside potential for the new owners.
© Arc, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to TMSalesOperations@arc-network.com. For more information visit Asset & Logo Licensing.