Challenge
- Navigating two separate sale transactions. Between the Walgreens and the 91,000 sf. center.
- Buying three replacement assets on an off-market basis.
- Developing a strategy to drive the highest price for a property with a cross-collateralized loan over 9 of the 10 parcels — the sum of the pieces of a center is greater than the whole.
Strategy
- Devised a strategy to market the shopping center (Del Oro) and Walgreens (STNL) separately to get the highest price for the asset. The two different buyer pools were as follows:
- The center should be sold to a sophisticated buyer with strong retail experience.
- The Walgreens should be sold to a passive investor looking for trophy STNL assets.
- Positioning: We positioned the center as an opportunity to purchase a center at a discount — that is fully parceled — with the ability to sell off the pads for a profit.
Results
- We sold the Walgreens and Shopping center at record breaking low cap rates for San Diego retail transactions in their respective categories.
- On the up-leg, we seamlessly placed our exchange client into three off market properties, tripling their cash flow from their down-leg position.
- It is Important to Note: we were able to procure the up-leg off market deals due to our institutional relationships.
