Thursday, August 14, 2014

Conn's Executes Sale-Leaseback at Metro Marketplace

By: Paul Dionne | Vizzda

Houston-based appliance retailer Conn's Inc. has sold its Metro Marketplace location to locally-based single-tenant investors, STORE Capital, in a deal valuing the freestanding big box space at $6.78m or $152.80 per square foot. As part of the transaction, Conn's inked a thirty year lease with STORE for the location with three 5-year options to extend and Conn's retains the remainder of the neighborhood shopping center, which they acquired from Brixmor--then an affiliate of Blackstone Group--in September of 2013 for $6.1m or $24.16 per square foot.

The 44,370 square foot freestanding building was built in 1988 on roughly 2.98 acres, zoned C-2 in an 243,786 square foot shopping center on 18.54 gross acres at the northwest corner of I-17 and Dunlap Road in Phoenix. As mentioned above, the prior sale included not only the current asset changing hands, but also another 43,469 square foot anchor space, a 19,527 square foot sub anchor, 136,375 square feet of inline, including the inline space adjacent to the subject parcel to the north, which did not convey, and two pads totaling 8,697 square feet.

The shopping center was previously acquired by Brixmor pursuant to the $6.2b acquisition of Excel Realty Trust by Centro properties in late July 2007. In mid 2011, Brixmor was acquired by private equity fund Blackstone Group for $9b, with transfer of the subject asset made by quit-claim in early July 2011. Following the quit-claim, Blackstone encumbered this property and several others under a $1b note comprised of two $450m notes with German American Capital Corporation and $100m with Barclays. Those notes were assigned to US Bank and securitized in August of 2012 with a 4.16% interest rate. As noted above, Conn's acquired the shopping center for $6.1m in an all cash sale, releasing the prior CMBS debt, and STORE acquired Conn's big box space this week in a deal that was 100% financed by Citibank.

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Paul Dionne -

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