FEATURED ACQUISITION

Ridgecrest Plaza

Orange Park, Florida
|
100,895
square feet

Ridgecrest is a 100,895 square foot community shopping center in Orange Park, FL (Jacksonville MSA), located on the submarket’s main commercial thoroughfare and anchored by Ollie’s and Dollar Tree.  The center is well exposed (69,000 VPD at intersection), situated just south of the Orange Park Mall and north of newly constructed St. Vincent’s Hospital.  63% of GLA is occupied by national tenants with recently extended or new long-term leases.

  • Growth Market: Within a 5-mile radius there are 139,253 residents with expectations of 150,000 by 2020.
  • Downside Protection:  The center is being purchased well below 50% replacement cost; the cost it would take to buy the land and build new.
  • Attractive Pricing: Purchased at an extreme discount (nearly 10% cap rate) due to great timing with a motivated seller and Big V’s well-earned reputation for closing deals.
  • Extend Leases: We utilize strong tenant relationships to extend leases, thereby quickly stabilizing the center, providing an immediate value-add.  Ollie’s already has a long lease but has expressed interest in extending it further because of strong store performance.  Teen Challenge is doing exceptionally well and ready to execute a lease extension as well.
  • Vacancy Lease-Up:  Currently, 18,000 sf (18%) available to lease in an area where 9% is the average vacancy rate. It’s worth noting that this center is in a superior location relative to others in the market. We feel we can quickly capitalize on this market imbalance.
  • Rental Pricing Power: We believe demand for this center is high and current rents are below market.  As leases come due without options, we expect to push rents to market, thus realizing NOI growth.
  • Outparcel Sales: A large value driver for this center will be the sale of the highly visible outparcel on the corner of the intersection.  While comps in the area are $1 million for similar sized parcels, we conservatively modeled ours at $600,000.
  • 5 Year Projected IRR: 19.55% annualized
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