TAMPA, FL—With a record low cap rate for unanchored retail that some brokers say signals a recover, East Bay Plaza has trade hands. The Largo, FL retail center sold for $2.95 million in an all-cash deal. The sale price represents $283.63 per square foot.
“The in-going cap rate of 7% is the lowest we have seen for a stable retail center in years,” Franklin Street’s Jonathan Graber tells GlobeSt.com. “The market for unanchored retail centers has been improving since 2013 and is approaching levels last seen in 2007 and 2008.”
Graber and Franklin Street’s Rafeal Wright represented the seller, East Bay Plaza Integra, a Florida Limited Liability company. Franklin Street put together this off-market transaction with a 1031 buyer, Warner Enterprises, a California Limited Partnership.
“The seller was an experienced retail owner and developer out of Southeast Flora,” Wright said. “This retail center is located in one of the area’s most important retail sub-markets.
As Graber sees it, this is happening for several reasons. He lists the reasons as: record-low cap rates for triple net and multifamily property; historically low interest rates; a lack of new construction; positive absorption of retail space; and access to attractive financing.
Built in 2008, the 10,401-square-foot unanchored retail plaza is 100% occupied with a mix of national and regional tenants including Einstein Bagels, Anytime Fitness, Liberty Tax Service, Radio Shack, and Zoom Tan. The deal also included a long-term billboard lease.
“With Kimco Realty working on one of the area’s largest retail redevelopments across the street and Walmart opening a new supercenter on the opposite corner earlier this year, this intersection continues to gain in value,” Write tells GlobeSt.com. “Additionally, this area of Pinellas County has some of the strongest population densities and traffic counts in all of Tampa Bay.”
East Bay Plaza is located at 5395 East Bay Drive in Largo, FL. It sits on the southwest corner of US 19 and East Bay Drive. Download PDF