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Gwinnett Shopping Center Sale Part Of Suburban Trend

Phillips Edison
Mountain Crossing in Dacula, which was recently acquired by a Phillips Edison fund

A major institutional investor is making a bet on retail 25 miles north of Downtown Atlanta.

Phillips Edison Grocery Center REIT II — a fund controlled by Cincinnati-based Phillips Edison & Co. — has purchased Mountain Crossing, a nearly 94K SF Kroger-anchored shopping center in Dacula, Georgia, for $13.8M, or $148.50/SF. Atlanta-based investor Mountain Crossing Associates — tied to Redd Realty Services, according to the Georgia Secretary of State — was the seller.

Franklin Street Senior Directors John Tennant and Bryan Belk brokered the sale.

Mountain Crossing — in one of Atlanta's most populous suburban counties, Gwinnett County — is nearly full with chain tenants including UPS, Wells Fargo and Great Clips. Tennant said Phillips Edison was attracted to the center given it was near a new interchange off of Interstate 85 and Gravel Springs Road.

Phillips Edison is not alone in shopping for shopping centers in the suburbs.

“Investors have shown particular interest in Atlanta suburbs chasing yield that is not found in the urban core of Atlanta,” Belk said. “Atlanta and its suburbs remain a popular moving destination due to its booming economy and low cost of living.”

recent Marcus & Millichap report echoed those sentiments, saying out-of-state investors, especially from California and New York, have been shopping in suburban counties like Gwinnett, North Cobb and South Atlanta, “eyeing recently built assets with 4% minimum yields.”

Overall investor demand for Atlanta retail properties this year has fueled an average price climb of more than 8% to $315/SF, Marcus & Millichap officials said.