Bridgeside Shopping Center
Bridgeside Shopping Center in Alameda, is a ±105,000 square-foot shopping center that sold for $48.5M. The seller was a high profile institutional client that wanted core pricing. The center was anchored by Knob Hill Grocer, a Raley’s brand that at the time did not have a credit rating and very private financial statements.
There were three grocery anchored centers on the island of Alameda with stronger sales performance than Knob Hill. The property contained an atypical layout with some second floor office space, in addition there were several tenants in violation of the grocer’s use restrictions.
We were tasked with navigating the new ordinance of the private sewer lateral program to make sure it closed on time and didn’t cost our client any additional money (East Bay Private Sewer Lateral Program).
We reached out to high probability institutional buyers prior to taking the asset out to market. This was done to overcome the grocer’s lack of credit and highlight the strong cost of occupancy as the grocer was paying below market rent. We could leverage interest generated prior to going to market to get buyers to compete in three different rounds. We wanted to execute a controlled process with a call for offers, best and final, and buyer interviews to try to max out final terms.
Despite the immediate competition in Alameda, we generated 13 offers and invited 3 buyers to the best and final round.
We closed with an institutional buyer at $2M above where the majority of the other offers came in.
This transaction was a record breaking cap rate for a San Francisco grocery anchored shopping centers at 4.9%.
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More Success Stories
Institutional Seller with strong expectations. Not main and main within the market. Restrictions on fully marketing the asset. Short timing to sell the property. Record cap rate for the Pacific Northwest. Sold to an exchange buyer off market that was based in Beverly Hills. Delivered again for one of our top clients. Help us take the top spot for grocery sales in 2020.
Top performing Kroger grocery store coupled with Kmart anchor on eve of bankruptcy. Underperforming shop tenant performance and new development competition. Northward market migration and residential growth. How to get value for Kmart space with limited prospects to backfill 100,000 SF. Kroger controlled redevelopment via site plan modification approvals.
High seller expectations for REO asset at excellent location near high-performing regional mall. Second generation replacement anchors HH Greg & Gander Mountain lacked credit. Functional obsolescence of enclosed mall shops resulted in under-performance. Outdated movie theater lacked credit, but required significant LL renovation contribution. High expectations based on quality of location but encumbered by current leases. Vintage physical plant was dated with deferred maintenance.
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