HEADING WESTWARD
Apr 1, 2008 12:00 PM
While other companies have been putting the brakes on their acquisition strategies in the wake of the credit crisis and falling retail demand (year-over-year national sales volume dropped more than 50 percent in the first two months of 2008, according to Real Capital Analytics), Costa Mesa, Calif.-based real estate owner Donahue Schriber has been upping its game. The firm recently posted a company record for acquisitions in a month with the purchase of three retail properties in the Pacific Northwest.
The centers included Keizer Station, a 650,000-square-foot power center in Keizer, Ore.; Warner Ranch Plaza, a 155,000-square-foot grocery-anchored shopping center in Tempe, Ariz.; and Gold River Centre, a 140,000-square-foot grocery-anchored shopping center in Sacramento County, Calif. The purchases, which totaled $189 million, mark Donahue Schriber's first entry into the Pacific Northwest.
The Pacific Northwest area, including Washington and Oregon, will outperform the rest of the country this year due to steady job growth and an expanding retail sector, says a 2008 forecast report from national real estate services firm Grubb & Ellis Co. As a result, retail rents in the region will continue to rise — by 3.4 percent to $22.21 per square foot in the Seattle market and by 3.4 percent to $18.26 per square foot in the Portland market, according to Marcus & Millichap Real Estate Investment Services.
Sacramento County is expected to experience steady rental growth in 2008 as well. Retail rents in the area will rise 3.9 percent this year, to $25.04 per square foot, says Marcus & Millichap. Meanwhile, vacancy will drop 40 basis points, to 8.2 percent.
