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Part 2: Deal Volume January 13, 2011

Posted by Sean Tufts in Research/Data, Retail News, Retail Sales Comps.
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Part two of the 2010 data recap is focused on transaction volume.  We track total dollar volume as well as number of transactions of multi-tenant retail investment sales in King, Snohomish and Pierce counties.  It does not include single tenant or out of area retail sales.  2010 represented the first year for real distressed deals being taken back by lenders.  There were 10 retail centers that went back to the lender, including Meridian Village in Bellingham, Old Mill Town Center in Edmonds, and Kelsey Station in Monroe among others.  The total foreclosed dollar volume was just over $40,000,000.

Although there were still some significant single tenant net leased sales, that volume was down almost 40% from 2009 to roughly $36,000,000.

Only twelve non-distressed multi-tenant retail centers traded hands in the Seattle area during 2010 with a total sales volume of $60,097,000.  That dollar figure is down 19% and the number of transaction was down 25% from 2009.  We believe that retail really hit the bottom in 2010 and investors shied away from stabilized assets and were out bargain hunting.  Some of the fear of retail has begun subsiding after a couple of stronger than anticipated months of retail sales topped with a better than expected holiday spending season.

Our projection moving forward is that some of the centers that lenders took back 2010 will be sold off and we will see more stabilized investment deals occur in 2011.  The biggest fears have been the stability of retail tenants and the ability to finance unanchored centers.  Those issues are starting to soften as the tenants that have made it this far have a significantly better chance of long-term survival and lenders continue to come back to the table willing to lend.



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