Urban Retail Properties Sale Over $1050 Per Square Foot
Calkain Urban Retail Investment Advisors, the Urban Retail Division of Calkain Companies, recently completed two sales of fully leased NNN urban retail condominiums in Washington DC. Two of the urban retail condominiums are located on the ground floor of The Alta, a luxury mixed-use condominium just below Thomas Circle on 14th street. The second sale was of the urban retail condominium at 14th and P, the heart of Logan’s Circle’s retail core, and the home of one of DC’s most renowned restaurants. The purchasers were private investors seeking stabile incoming-producing assets along DC’s robust 14thstreet corridor.
The transactions illustrate the strengths of well-situated
urban retail investment properties, namely the adaptability of an urban retail
space and the upside potential flowing from a dynamic urban setting. Perhaps
most remarkably, the sellers were able to capitalize on those key strengths
just a few years after first acquiring the properties. The sales, one closing
at over $1050 per square foot set new benchmarks for what is attainable in
non-credit, locally tenanted NNN investment property. Similar to an in-line space in a shadow
anchored or power center a single urban box (owned fee simple) can accommodate
a variety of uses with the key difference being that it is the convergence of
people and traffic that acts as the anchor in the urban scene. In the case of the property at 14Th and P,
the loss of the original tenant (a garden store) provided the owner with an
opportunity to secure a more favorable lease with a stronger use (a fine-dining
restaurant) under a higher rent per square foot. The recent sale closed at a cap rate 150bps
below his original purchase.
Well situated urban retail within high traffic locations in
diverse residential, office and retail communities provides an investor with
broadly adaptable real estate. While
some may reject NNN properties in this setting a closer looks reveals that these
urban retail properties provide a stable income stream with real upside
potential that far exceeds anything offered by a suburban pad site in the
shadow of a big box store.
