By Meghan Hall
South Point Plaza, a multi-tenant retail property located in Everett, has traded hands, making the deal one of the more sizable retail transactions of the year. In the deal, San Diego-based Retail Opportunity Investments Corp. (ROIC) paid $37.15 million for the assets. Public records indicate that ROIC purchased the property from Pacific, Wash.-based Trimark Property Group.
The asset is located at 1021 Evergreen Way and was initially constructed in 1986, according to data from CommercialCafe. A power center, the property totals 189,960 square feet, as well as 15.27 acres of land. The center’s current tenants include Hobby Lobby, Rite Aid, Pep Boys and Outback Steakhouse.
The center also sits in a commercial part of town, not far from a Fred Meyer-anchored retail center and the Everett Mall, complete with a Walmart Supercenter. CostcoWholesale, as well as Sportsman’s Warehouse, are also nearby.
The property’s new owner, ROIC, is a fully-integrated real estate company and qualified REIT, according to its website. The company focuses on acquiring, owning and repositioning “necessity-based” retail properties. ROIC prefers to target assets in densely-populated locations in middle- and upper-income markets, and focuses on the West Coast. To date, ROIC owns and operates 86 shopping centers totaling about 9.8 million square feet.
Retail’s future remains uncertain as the emergence of the Delta variant impacted reopening plans. Activity in urban core areas that depend on daytime employment still remains below pre-pandemic levels, and both staffing and supply chain issues will remain large challenges. However, fundamentals are improving, according to Kidder Mathews. During Q3, the direct vacancy rate declined to 2.72 percent, and rent growth was 3.7 percent year-over-year. Additionally, construction in the retail sector remains muted and on a build-to-suit basis. While there are projects in the works, limited new supply will ultimately help the market recover.
Investment activity is also occurring; during the past few months there were 71 retail sales over $2 million. 14 were for redevelopment sites, four were gas stations and six were four dealerships. Evergreen Plaza, Lakewood Colonial East and White River Junction also marked some of the larger deals this past quarter, and the average cap rate came to 5.62 percent.