TOWN CENTER - Barrett Creek Plaza fetched $7.8 million in a recently announced sale of the 28,481-square-foot strip shopping center, indicating interest in retail properties could be starting to pick up in Cobb County.
Barrett Creek Plaza is at 125 Earnest Barrett Pkwy. in Marietta, across from Super Wal-Mart and Publix-anchored centers, as well as near the 1.2 million-square-foot Town Center at Cobb Mall anchored by Belk, JCPenney, Macy's and Sears.
The multi-tenant shopping center is situated on 3.7 acres and was built in 2003. The center is leased to national and regional credit tenants including Axiom Staffing, Buffalo Wild Wings Grill & Bar, Chase Bank, Cheeseburger Bobby's, Moe's Southwest Grill and T-Mobile. The property was 89 percent occupied at the time of the sale.
The buyer was a private investor from Miami Beach, Fla. The seller was Westwood Financial of Los Angeles, announced Hanley Investment Group Real Estate Advisors, which brokered the deal. The sale price of $7.8 million breaks down to $274 per square foot.
Hanley said the property comes with an 7.8 percent capitalization rate, which is the annual net return on investment for the owner after taxes and expenses are paid.
"That's a really good rate of return. It's a no-brainer really," said Ed Hammock, owner of Ed Hammock Realty in Marietta. "Most investors today are wanting a minimum of 7 percent return." Hammock said the sale of Barrett Creek should not fool anyone into thinking the entire commercial real estate market is this strong. "It's a good deal. But you go down the street and you may have a center with a lot of mom and pops as tenants, and you couldn't do the same deal," he said.
Hammock said vacancy rates are still unacceptably high at many of Cobb's older shopping centers. "Those are not selling too well, but the ones with anchored stores and the ones like (Barrett Creek) are the ones that are selling," he said. "It has to have a good cash flow with good tenants." Kevin Fryman, William Asher and Edward Hanley represented the buyer and seller in the sale of Barrett Creek Plaza.
"We generated multiple offers and procured an all-cash buyer," said Fryman. "We are experiencing comparable activity on other similar unanchored multi-tenant retail that have paralleled the single-tenant market. If supply remains low, we anticipate investors to continue to lower their expectations on minimal acceptable returns for multi-tenant retail as long as interest rates stay steady."