Coffman Peddles CVS Stores for $9M

BROCKTON, MA-A 10,000-sf retail asset here is among three CVS Drugstores sold by Coffman Realty for a total consideration of $9.2 million. Main Street Brockton LLC paid $3.7 million for the CVS in this South Shore community, while the other two buildings were purchased by One Liberty Properties, a REIT based in Great Neck, NY, which acquired a Hyannis CVS and another on Cape Cod in Marstons Mills.

“It’s tough to get any retail on the Cape,” says broker Jonathan Aron of NAI Hunneman Commercial Co. in explaining the added attraction the stores there had for prospective buyers. Aron handled the three divestments for Coffman. All of the buildings are freestanding and were purchased with the existing debt in place. The debt aspect extended the sales process into the teeth of the national credit crisis, but the negotiations ultimately survived those difficult conditions.

Often favored by 1031 exchange groups, small- and mid-sized retail opportunities are increasingly capturing the attention of other investors, says Aron, an industry professional with extensive experience in handling middle market retail sales of $3 million to $25 million. At a time when capital is seeking safe harbors, the lengthy lease terms of up to 25 years and passive management found in net-leased retail fit the cautionary mindset, he explains. “Drug stores are a real haven,” says Aron, although the three CVS stores are older structures that only have about a decade or so of lease term remaining.

One Liberty is a NYSE-traded entity focusing on net-leased real estate, and has assembled a geographically diverse portfolio of industrial, office and retail product. Tenant strength, demographics and superior locations are among the firm’s criteria. Such was the case in the Cape deals, according to One Liberty President Patrick Callan, who says in a release that the $2.3-million buy of the Marstons Mills CVS “furthers our stated objectives of acquiring quality properties with long-term net leases to quality tenants.” One Liberty paid $3.2 million for the Hyannis property, of which $1.9 million was paid by assumption of an existing first mortgage.

Coffman Realty is an active developer, manager and owner of commercial real estate in southern New England. The firm’s retail resume includes buildings for such retailers as Applebee’s, Autozone, Hollywood Video and Staples during its 20 years of existence.