January 16, 2018 | Commercial Property Executive
By Barbra Murray
Doral Commons, which was 95 percent leased at the time of sale, fetched $514 per square foot two years after being completed.
Two years after completing development of Doral Commons in Doral, Fla., Terra Group has traded the 140,000-square-foot retail center for approximately $72 million, or roughly $514 per square foot. With the assistance of commercial real estate services firm Cushman & Wakefield, the integrated real estate development and investment firm sold the grocery-anchored property to Jamestown LP.
Located 15 miles west of Miami, at the intersection of NW 74th St. and 107th Ave., the Doral Commons shopping center made its debut in early 2016 and originally served as the retail portion of Terra’s mixed-use Doral Commons project, which has been credited with redefining Doral’s new architecture. The retail and residential segments were later separated.
The retail plaza was 95 percent leased at the time of sale to a host of national and local tenants, including Publix, which anchors the property with a 49,000-square-foot space leased through 2040. With the asset stabilized, Terra was ready to sell—and Jamestown seized the opportunity.
“This is a case of Terra taking a forward-looking approach to acquiring a site, recognizing a void in the market, and creating value through execution and leasing,” Mark Gilbert, executive managing director with Cushman & Wakefield, said in a prepared statement. “The Doral Commons sale coincides with a surge of retail leasing activity in Doral which is creating heightened demand among sophisticated investors such as Jamestown.”
HIGH RANKINGS FOR MIAMI RETAIL
Miami-Dade’s retail sector is an investor favorite, and for good reason. The overall vacancy rate in the area is in the 4-percent range, and it’s even lower in Doral, which boasts a 2 percent vacancy rate, according to research by C&W. Rental rates continue to inch upward as well.
Miami-Dade transactions involving grocery-anchored shopping centers in the last quarter of 2017 alone include a private investor’s purchase of the 106,400-square-foot Old Cutler Towne Center in Cutler Bay for $31.8 million, and another unidentified buyer’s $37.5 million acquisition of Village of Oriole Plaza, a 155,000-square-foot property in Delray Beach. And Jamestown, clearly keen on the market, acquired the 100,000-square-foot Country Club Plaza in Miami Gardens for $34.3 million. Investor interest is not expected to wane in the near future.
“The demand for investors looking to buy retail assets is also expected to increase over the next couple of years due to Miami’s status as a global destination which has helped it through rough patches in the U.S. cycles in the past,” per the C&W report. “Cushman & Wakefield anticipates retail conditions to remain in positive territory despite a maturing market, due to Miami’s robust tourism, steady population growth and new construction.”