Mercado is a recently repositioned 97,000 square foot essential needs grocery and discount shopping center located in San Marcos, a submarket of San Diego County, which includes national credit tenant roster of Dollar Tree, DD’s Discount (Ross), Grocery Outlet, AutoZone and Western Dental.
- Acquired a 96,606 SF grocery-anchored shopping center in San Marcos, California, for $19.25M ($200/SF) and 7.00% cap rate in September 2019
- Located in one of North County San Diego’s fastest-growing submarkets and situated at the heavily trafficked intersection of Highway 78 and Rancho Santa Fe Rd along the critical corridor connecting major interstates (I-5 and I-15), the shopping center is near 60,000+ students (Cal State San Marcos and San Marcos Unified School District) as well as approximately 3,500 new single family homes planned, under construction or recently built in the trade area
- Credit tenant roster including publicly traded Fortune 500 and investment-grade anchors in Dollar Tree and DD’s Discounts (Ross), as well as strong national and regional tenants such as Grocery Outlet, AutoZone, Cox Communications, and Western Dental
- Completed compelling value-add plan that included a comprehensive rebrand of the shopping center, including a new logo, website and signage, in addition to exterior improvements that enhanced the property’s appearance, improved the customer experience, and addressed critical maintenance related to landscaping, roof and mechanical replacements, and parking lot repairs, while maintaining cash reserves to complete the investment’s strategic leasing plan
- Executed lease renewals with 97% of the shopping center, securing long-term tenancy with nationally recognized discount retailers for the anchor spaces, as well as signed multiple 10-year lease agreements with new tenants to fill several long-standing vacancies – bringing the property to 99% leased and resulting in net operating income (NOI) growth of 23% in less than 5 years after acquisition
- Placed long-term financing at 3.62% fixed-rate and 60% loan-to-value at time of acquisition
