New York Investor (Barely) Buys Suburban Atlanta Power Center
In any other time in commercial real estate history, the sale of North Logan Commons would have been a routine commercial real estate transaction.
But the coronavirus pandemic is not just another time in CRE history, and for Los Angeles-based CIM Group to sell a suburban Metro Atlanta shopping center, it had to extend the closing deadlines numerous times and shave the price by $400K.
“It wasn't, per se, a specific thing. It was just globally pandemic-related,” said Transwestern Vice President Fred Victor, who brokered the deal for CIM. He added that the sale was among the most difficult he had taken to the finish line in his 20-year career.
New York-based Big V Property Group purchased the 176K SF power center off Atlanta Highway in Loganville this month from CIM for $15.6M.
Big V began negotiating to buy North Logan Commons prior to the pandemic and then put the center — anchored by T.J. Maxx, Dick's Sporting Goods, OfficeMax and PetSmart — under contract on March 12, a day after the World Health Organization declared the coronavirus a global pandemic.
What followed was a string of contract extensions and an eleventh-hour race by Big V to find a new lender after its initial backer dropped out over the retail industry’s health concerns as a result of the pandemic, Victor said.
“Fortunately, they just closed a deal on the outskirts of Charlotte and were able to substitute that lender in,” Victor said.
The purchase is an example of the increasing difficulty both investors and sellers have in trading retail properties during a pandemic, especially as retailers shutter for good. For the retailers who do survive, many are seeking rent help to get through the worst of the business fallout from social distancing restrictions.
Two-thirds of North Logan Commons' tenants are receiving some sort of rent assistance, Victor said, mainly in the form of deferment.
“Very, very minimal [retail investment] activity, which makes this deal even more special. A lot of people are just still sitting on the sidelines,” Victor said. “They're waiting to see kind of what happens with the pandemic.”