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TUKWILA, WA-Regency Realty is looking to unload its 84,380-sf Bed Bath & Beyond Retail Center here, adjacent the 1.5-million-sf Southcenter Mall. The asking price is $13.95 million, or $165 per sf, representing an 8.75% cap rate. Paul Sleeth of Colliers International, Seattle, the listing agent, tells GlobeSt.com the center is 100% occupied and undergoing extensive remodeling.

The development is on 4.54 acres at 240 Andover Park West, amid the largest concentration of retail–some four million sf–in the Pacific Northwest, says Sleeth. “The exceptional tenant mix in the Southcenter area produces a retailing destination with a trade-area draw that far exceeds that of most regional malls and typical power centers.”

The Bed Bath & Beyond retail center, built in 1967, currently produces net operating income of over $1.2 million with its three tenants: Bed Bath & Beyond with 45,476 sf, Guitar Center with 18,066 sf, and Oak Mill Furniture with 20,014 sf. BB&B and Guitar Center’s leases run through December 2010, and Oak Mill Furniture’s lease is not scheduled to terminate until January 2008. Although the price per sf was not made public, Colliers says that the three leases contain escalation clauses.

BB&B is a nationwide chain of 272 superstores with 1999 sales of $1.78 billion, and a market capitalization of $6.02 billion. Guitar Center operates 66 stores in 33 major US markets, with a 1999 market capitalization of $330.8 million and sales of $620 million. Oak Mill operates 12 stores in Washington, Nevada and California, which specialize in medium to high-end home furnishings.

Regency Realty, a Jacksonville, FL-based REIT, has nine other retail properties completed or under construction in the Puget Sound area, including a second 58,281-sf property in Southcenter anchored by Target. Regency is a national owner, operator, and developer of grocery-anchored neighborhood retail centers, with a portfolio of 235 shopping centers in 22 states. A company spokesman was not immediately available to comment on the sale of the Bed Bath & Beyond property.

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