Hanley Investment Group Arranges Sale of Retail Pad Building Shadow-anchored by Walmart in Rockford
Three-tenant retail building occupied by Aspen Dental, Fast Signs and Sleep Number is purchased by Southern California investor for 7.23 percent cap rate.
Lefko and Asher represented the seller, N3 Real Estate of Southlake, Texas. The buyer, a private investor from Orange County, Calif., was represented by Ronald Shunia of BOSC Realty Advisors in Bloomfield Hills, Mich.
The three-tenant building is located on 1.08 acres at 7310 Walton Street in Rockford at the intersection of E. State Street and Buckley Drive. State Street is the main east/west thoroughfare in Rockford with 33,000 cars per day. The 100-percent occupied property, which was built in 2008, is situated 1/2 mile from Interstate 90, connecting Rockford to Chicago and Madison, Wis.
"Aspen Dental recently renewed its lease demonstrating Aspen's commitment to the site," said Lefko. "The property is well located in a market with strong fundamentals. These characteristics allowed us to obtain a near stabilized value for a 10+-year-old asset with short-term leases."
The property also benefits from the high volume of traffic created by Walmart and is clearly visible at the entrance to the center. Other nearby national retailers include Target, Ashley Home Furniture, Best Buy, Dick's Sporting Goods, Hobby Lobby, Home Depot, HomeGoods, Kohl's, Lowe's, Ross Dress for Less, Texas Roadhouse, and Sam's Club.
Asher notes that there are more than 800,000 people living within 45 miles of Rockford and the city benefits from people commuting throughout the region and stopping in the area. "Rockford is the third largest city in Illinois and the largest city outside the Chicago metro area," Asher continues. "Rockford is ranked as one of the '15 Best Places to Move to in the U.S.' by Reader's Digest (2018)."
"Rockford is located in the burgeoning I-90 growth corridor and is part of the third largest economic corridor in the U.S.," Lefko said.
Approximately 75 percent of all U.S. businesses are located within a 24-hour truck drive. Rockford is accessible to multiple major markets including Chicago (90 miles), Madison, Wis. (60 miles), and Milwaukee (80 miles).
Last month, Lefko and Asher arranged the sale of a two-tenant retail building occupied by a Starbucks with a drive-thru and QDOBA Mexican Eats in Sioux City, Iowa, on behalf of the seller, N3 Real Estate. Hanley Investment Group procured an all-cash, 1031 exchange buyer based in Southern California and obtained a record cap rate for a two-tenant net-leased investment in the Midwest that had approximately 65 percent of the original lease terms remaining for both tenants.
"West coast investors continue to seek a better return in Midwest markets like Chicagoland's city of Rockford and Sioux City, Iowa for assets leased to national credit tenants," said Lefko. "Markets like Rockford and Sioux City typically feature low unemployment rates and are relatively insulated from big rent declines."
Asher adds, "As the retail investment market continues to transition this year, these sales continue to demonstrate that investors are willing to transact at premium pricing for properties with excellent real estate fundamentals in 'A' locations in markets across the country," Asher noted.
About N3 Real Estate
N3 Real Estate is a fully integrated retail real estate investment and development firm based in Southlake, TX focused on developing restaurant, retail and net lease real estate. Founded in 2004, N3 has acquired and developed single and multi-tenant commercial projects and shopping centers for national, regional and local retailers and restaurants across the United States. Today, N3 owns and manages retail projects for its investors at a value of more than $250 million. See: www.n3realestate.com.
About Hanley Investment Group
Hanley Investment Group Real Estate Advisors is a retail investment advisory firm with a $6+ billion transaction track record nationwide, who works closely with individual investors, lending institutions, developers, and institutional property owners in every facet of the transaction to ensure that the
Jeff Lefko - 949.585.7682
Bill Asher - 949.585.7684