PHOENIX-Whitestone REIT broadened its Phoenix footprint with its acquisition of the 118,209-square-foot Fountain Square for $15.4 million. The transaction was all-cash and represented a 49% discount-to-estimated replacement cost.
The center at 350-610 E. Bell Rd. is 76% occupied, allowing plenty of upside for the Houston buyer. Construction is already underway to build out a 20,000-square-foot space dedicated to Planet Fitness. Records list the previous owner as Lakha Properties-Phoenix LLC, though the center was acquired from receivership.
The vacancies since the ‘08-‘09 recession are primarily due to restricted and limited funds from the court appointed receiver to pay for tenant improvements and leasing commissions," says James C. Mastandrea, Whitestone’s chairman and CEO in a press release. Mastandrea adds that Whitestone's efforts will involve renovation and lease-up of the 1980s center.
Shadow-anchored by a Safeway grocery store, Fountain Square tenants include US Bank and Rent-A-Center, several medical/health care service providers, casual restaurants, Weight Watchers and educational tenants such as Kumon Math & Reading and Yamaha Music School. The acquisition means Whitestone now owns nearly 870,000 square feet of lease space in the greater Phoenix area, having acquired 11 community retail centers during the past couple of years.
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