Similar assets trade for $115 per sf to $130 per sf. According to the deal's broker, HK Capital Management Inc. was drawn to retail center at 2410 E. Riverside Dr. for its upside, particularly a soon-to-be vacant 60,000-sf H-E-B grocery store.
"They're demolishing that and behind it, are building an H-E-B-plus," says David Simmonds, senior vice president in Austin for Dallas-based Weitzman Group. Simmonds, who represented the seller, RPSC Ltd. of Laredo, TX, says once the new 125,000-sf grocery store is open, the old site will become a parking lot. "That will open up our center big-time," says Simmonds, who teamed with Weitzman Group's senior vice president Ben White and president Lance Morris to sell the asset. HK Capital was self-represented.
Riverside Place Shopping Center is situated on 9.4 acres. The 93%-leased center is home to Blockbuster Video, Wingstop, Mr. Gatti's, H & R Block and Joy East Café. Between one and three leases roll per quarter, with Simmonds pointing out to GlobeSt.com that with the new H-E-B and more parking that rents can be raised across the board.
Simmonds, whose team is leasing Riverside Place, says HK Capital is on the lookout for more properties to buy. The company, which specializes in class C centers, has many assets in Houston. "They like value-add shopping centers in minority neighborhoods and mature trade areas," he adds. "This is their specialty. They understand it and know how to make money from it."
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