Hanley Investment Group Concludes 4th Quarter 2012 With Sale of 23 Retail
Retail Investment Sales Velocity to Continue to Increase in 2013
IRVINE, Calif., Jan. 17, 2013 (GLOBE NEWSWIRE) -- Hanley Investment Group Real
Estate Advisors, one of the most dominant retail investment groups in the
United States and a market leader in the sale of retail properties, announced
today the company closed out the fourth quarter of 2012 with the sale of 23
retail properties totaling over $90 million. The retail transactions span
grocery/drug anchored shopping centers, multi-tenant and single-tenant retail
properties. Hanley Investment Group achieved many milestones during the fourth
quarter including a record sales price of $1,064 per square foot (psf), the
highest sale price per square foot for a multi-tenant strip center in Los
Angeles County in 2012.
In the summer, Hanley Investment Group negotiated the sales of 3 high profile
grocery-anchored shopping centers in Southern California within 120 days of
each other, totaling nearly $77 million. The Landing, a 44,289-square-foot
landmark Vons Pavilions-anchored center on Balboa Peninsula in Newport Beach
was of institutional quality and the $34.89 million sales price represented
$790 psf on a fee simple basis. According to Edward B. Hanley, president of
Hanley Investment Group, one of the brokers who negotiated this transaction,
"This was the highest sale price psf in the last 5 years for the purchase of a
grocery-anchored center in California and was challenging due to the fact that
the sale was structured using REIT stock." Eric P. Wohl of Hanley Investment
Group assisted with the sale of stock in the company that owned The Landing
Additionally, Hanley represented the buyer and seller in the $22.85 million
sale of The Marketplace in Palm Desert, a 96,463-square-foot Stater
Bros/Walgreens-anchored center. This was one of a very few grocery-anchored
centers to trade in the area. The third sale, a 91,631-square-foot
Vons-anchored center, Seabridge Marketplace in Oxnard was an off-market
transaction brought about by the need to extract the ownership from a very
difficult lender. "From start to finish, we closed in 7 days," said Hanley.
Hanley represented the buyer and seller in this transaction as well.
In December, the surge of retail transactions ranged from single-tenant retail
property sales (sale-leaseback portfolio of six Wendy's restaurants in
Alabama, a single-tenant Chase bank in Riverside, California, and a
single-tenant 89,249-square-foot Kohl's in Port Orange, Florida) to the sale
of a 132,547-square-foot shopping center anchored by Office Depot and Big Lots
in Rock Hill, South Carolina. Other sales included a 31,140-square-foot
CVS/pharmacy-anchored shopping center on 2.54 acres in Huntington Beach,
Calif., and a 76,947-square-foot Kroger-anchored shopping center in
Charleston, West Virginia.
"There were a flurry of closings at the end of 2012 as sellers attempted to
avoid the potential higher capital gains taxes on property sales," said
Hanley."In 2013, we expect to see sellers focused more on exchanging after
evaluating the new tax laws."
Hanley continues, "As the industry works through the aftermath of the
elections and endless fiscal cliff discussions, momentum will build rapidly.
Watch for increased investor confidence, which will lead to higher demand for
retail investment opportunity. I am anticipating a very busy year for retail
"With minimal new supply and continued increasing demand, retail vacancy rates
should experience some downward pressure in 2013," Hanley added.
Eric P. Wohl, president of HIG NNN, a division of Hanley Investment Group
specializing in the sale of single-tenant net-leased properties, said that the
single-tenant net-lease sector of the market is still one of the hottest
segments within commercial real estate right now. Lack of supply, record low
interest rates, and slower tenant expansion plans are creating a feeding
frenzy for corporately-backed single-tenant properties such as McDonald's,
CVS, Walgreens, Chase and Wells Fargo.
In 2012, Hanley Investment Group set multiple records for the lowest
capitalization rate for single-tenant drug stores. In April, Hanley Investment
Group achieved the lowest cap rate for a Walgreens in over 3 years in San
Bernardino County with the sale of the Walgreens in Victorville, Calif., at a
5.69% cap rate, sales price $7,469,000. In August, Hanley Investment Group
sold a single-tenant CVS/pharmacy ground lease in Fresno, Calif., at the
lowest cap rate for all single-tenant drug stores in the nation in 2012 at a
5.25% cap rate, sales price $5,240,000.
Hanley Investment Group also achieved record low cap rate sales for
single-tenant banks three years in a row. Most recently in June, Hanley
Investment Group achieved a 5.1% cap rate for a Bank of America in Lancaster,
Calif., sales price $2,600,000. In the single-tenant fast-food restaurant
category, Hanley Investment Group achieved the lowest cap rate in 5 years for
a McDonald's in Orange County with the sale of a single-tenant McDonald's
ground lease in Santa Ana at a 4.25% cap rate, $2,825,000 sales price.
"Capitalization rates for single-tenant assets have dropped lower than where
they were in 2006-2007, which truly speaks to the high demand for net lease
properties and the lack of alternative investments in the marketplace,"
reports Wohl."Buyers are paying a large premium for well-located
single-tenant assets with corporately-backed leases in strong locations.We
have also seen a rapid increase in sale-leaseback activity as corporations and
franchisees are able to get top dollar for their real estate holdings and
realize 100% of the current market value so they can redeploy those funds into
their core business."
Carlos J. Lopez, president of HI Urban Retail Advisors, which specializes in
the sale and advisory of high profile mixed-use and urban street retail
properties, said, "We have seen pricing of quality urban and street retail
buildings surpass those at the high water marks of 2006-2007. I anticipate
that this pricing trend will continue during 2013, as there is a finite supply
of this asset type available and a growing buyer pool, both foreign and
domestic, that seek to acquire these properties."
Last month, Lopez represented the seller on two landmark retail buildings at
39 & 43 East Colorado Boulevard in the Old Pasadena District. The buildings,
which total 7,200 square feet and were 100% leased, sold for $3.7 million at a
cap rate of 5.95%. The last notable retail building to sell along Colorado
Boulevard in Old Pasadena, which housed Tiffany & Co., H &M, Abercrombie &
Fitch, just 2 blocks away, sold for $37 million in 2006. Lopez negotiated the
sale of that building as well. Currently, Lopez has in escrow the
Ralphs-anchored retail center at Market Lofts in downtown Los Angeles and
Hollywood Walk of Fame's landmark mixed-use building, 6904 Hollywood Boulevard
"With one of the largest databases in the industry and a strong inventory of
on-market and off-market opportunities, Hanley Investment Group has been one
of the most active retail investment brokers in the United States in the last
two years," Wohl stated. "Outside of California, Hanley Investment Group
negotiated 4th quarter 2012 sales of grocery/drug-anchored shopping centers
and single-tenant properties in Florida, South Carolina, West Virginia, New
Hampshire, Nebraska, Alabama, Texas, Arizona and Nevada."
"With just a few weeks into the new year, Hanley Investment Group already has
more than $100 million in escrow, plus a multitude of buyer requirements to
fill," said Hanley. "If January's volume of activity is any indication to how
the rest of the year will go, we know it is going to be another great year!"
About Hanley Investment Group Real Estate Advisors
Built on a solid foundation of performance, integrity and dedication, Hanley
Investment Group Real Estate Advisors is a boutique retail investment advisory
firm with a three billion dollar transaction track record that is comprised of
innovative specialists delivering unparalleled service and superior results
that consistently exceed client expectations. Hanley Investment Group's
expertise, commitment and unwavering focus of putting the client's needs first
have continued to set the company apart in the industry. Hanley Investment
Group works closely with individual investors, developers, and institutional
property owners in every facet of the transaction to insure that the highest
value is achieved. Clients rely on Hanley Investment Group to be the most
knowledgeable and trusted source for valuation services, market information
and retail property acquisitions and dispositions. For more information, visit
the Company's website at www.hanleyinvestment.com or call (949) 585-7610.
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The Hanley Investment Group Real Estate Advisors logo is available at
CONTACT: Anne Monaghan
Hanley Investment Group Real Estate Advisors Logo
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