Pad Building at Huntington Beach Sprouts-Anchored Center Trades for $4.1 Million
Hanley Investment Group Real Estate Advisors, a nationally recognized real estate brokerage and advisory firm specializing in retail property sales, announced today that the firm arranged the sale of a multi-tenant shop building shadow-anchored by Sprouts Farmers Market in Huntington Beach, Calif. The sale price was $4.1 million, representing a cap rate of 4.94%.
Hanley Investment Group Executive Vice President Eric Wohl represented the seller, a private investor from Newport Beach, California. The buyer, a private investor from San Diego, California, was represented by Randy Rivera of Capital Real Estate Ventures, also based in San Diego.
Located at the signalized intersection of Warner Avenue and Goldenwest Street at 6946-6968 Warner Avenue, the 8,600-square-foot retail property was 100%-occupied by four triple-net-lease tenants: Trading Post Fan Company, Advanced Dental Huntington Beach, Surf City Nails and Alternative Mind Concepts. The retail building, which was built in 1973, is situated on 0.75-acre parcel adjacent Sprouts and has excellent access and visibility including a large pylon sign and six points of ingress/egress, according to Wohl.
“An irreplaceable coastal location combined with significantly below-market rents made this a very unique offering rarely available on the market,” said Wohl. “The property is located less than three miles from the pacific ocean and Interstate-405 freeway and features below-market rents, ease of management with favorable triple-net leases and strong rental increases. The property also benefits from a population count of 188,000 people with average household incomes exceeding $116,000 within three miles of the property and more than 57,000 cars per day at the signalized intersection of Warner Avenue and Goldenwest Street.”
Wohl also added that all four corners of the signalized intersection feature shopping centers. Tenants include: Home Depot, Stater Bros., Ross Dress for Less, CVS/pharmacy, Big Lots!, O’Reilly Auto Parts, AutoZone, El Pollo Loco, Pizza Hut, U.S. Bank, Bank of the West, Friar Tux, 7-Eleven, Carl’s Jr., Cold Stone Creamery, Boston Market, Juice it Up!, Subway and more.
Last year, the National Retail Federation’s Stores magazine named Sprouts Farmers Market, Inc. (NASDAQ: SFM) as the 20th fastest-growing retailer in America. The company is No. 22 on Progressive Grocer’s 2019 Super 50 list of the top grocers in the United States. At the end of the first quarter of 2019, Sprouts had 322 stores from coast to coast. Last month, Jack Sinclair, former CEO of 99 Cents Only Stores and previously an executive at Walmart’s U.S. grocery division, was made CEO of Sprouts. The company opened its first store in 2002 in Chandler, Arizona and today offers a complete shopping experience that includes fresh produce, a butcher shop and deli, bulk foods, vitamins and supplements, dairy, bakery, body care items and more. With 90% of the company’s 20,000+ products being natural or organic, the stores cater to everyday shoppers interested in natural foods at affordable prices.
“Huntington Beach, known as ‘Surf City USA,’ attracts 13 million visitors per year and predicts an increase of more than 40% in job growth in its city over the next 10 years. The city was also named 15th in the ranking of “Best-Run Cities in America” (by Wallet Hub 2017),” Wohl said.
“As the retail investment landscape continues to transform, well located coastal properties such as the sale of the shops to Sprouts in Huntington Beach transaction continue to demonstrate that investors are willing to transact at premium pricing for properties with excellent real estate fundamentals in ‘A’ locations,” added Wohl.