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HOUSTON-A Sandy, UT-based investment group has broken into the market with 1031 exchange funds to acquire the 215,887-sf Northway Center from local retail giant, Weingarten Realty Investors Inc. The 96%-leased asset was up for grabs at $28.3 million.

Satterfield Helm Management Inc. outplayed competitors with the highest offer for Northway Center at 11077 Northwest Frwy. “This was a transaction driven by the special need created by the 1031 exchange,” George Cushing, senior vice president of Grubb & Ellis Co. in Houston, tells GlobeSt.com. “Everyone involved was pleased with the outcome.”

Cushing says the buyer was working a one-off to satisfy the exchange, probably retail from its homeport, rather than setting down roots to shop for additional properties in the region. But, he does add that the new owner’s going-forward plan for the class B Northway Center includes “creating value” via upgrades, renewals and new deals. The first step was to hire Wulfe & Co. of Houston to lease it for them.

Cushing says the 35-space center has six leases rolling next year, five in 2010 and six more in 2011. This year’s stack of four was put to bed before the deal closed, he confides. “As you’d expect, it has a lot of moving parts,” adds Cushing, whose partner on the deal was vice president Wendy Vandeventer.

Satterfield’s new real estate was developed in 1979 on 17.5-acre tract, now holding a front row seat at a significant intersection. “It’s a well located center, close in,” he says, citing the US Hwy. 290/Northwest Freeway and 34th Street junction where developable land has become hard to find. The center is situated close to the residential communities of Spring Branch, Garden Oaks and the Heights and eight miles northwest of Downtown Houston.

About four years ago, Weingarten scraped a Randall’s grocery store and rebuilt a 63,320-sf box for Katy, TX-based Academy Sports & Outdoors Ltd. Today’s tenant roster is 81% national and regional names, including Conn’s Appliances, OfficeMax and Goodwill Industries.

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