Paragon Commercial Group has sold a single-tenant, 45,648-square-foot retail property fully occupied by Walmart Neighborhood Market at 72314 Highway 111 in Palm Desert, California, to a private investor from Chicago for $13.5 million, according to a release from a representative of Newmark Knight Frank (NKF). The release says the property sold at a cap rate of 5 percent and the price amounted to approximately $296 per square foot.
The statement says the triple-net leased asset is situated on 5.37 acres at one of the most heavily trafficked intersections in Palm Desert at Fred Waring Drive and Highway 111 and that Walmart began operations at the site in October of 2012.
According to the release, NKF vice chairman William Bauman, executive managing director Kyle Miller and associate director Matthew Schwartz represented the seller, while the buyer was represented by Mike Mintz of Millennium Properties.
Miller is quoted in the release as saying “This is a well-positioned and stable asset with approximately nine years remaining on the lease with one of the world’s most successful retailers.”
He also notes that the property was one of Paragon’s first deals when it started the company. “The firm acquired the asset directly from Toys ‘R’ Us and immediately had tenant interest from a number of retailers.”
Miller says Paragon will be exchanging the proceeds from this sale and is currently seeking another value-add opportunity …”
According to the source, the property is located near such retailers as Whole Foods, Nordstrom Rack, Total Wine & More!, Target, TJ Maxx, and Best Buy and is supported by an affluent consumer base with more than 68,000 residents with average household incomes in excess of $100,000 within 5 miles of the property.
NKF reports that Palm Desert is widely recognized as one of California’s most coveted vacation destinations and is located within the Coachella Valley, which is home to the Coachella Valley Music and Arts Festival. The city comprises some of California’s most prestigious country clubs and golf courses.