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Foothill Square
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INVESTMENT FEATURES
12
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13
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24
Acquisition Date
$
26
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7
M
Transaction Size
17
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79
%
Realized Gross IRR
1
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53
x
Realized Gross Equity Multiple

Foothill Square Shopping Center

Oakland, CA

Fund:

Fund I

Type:

Retail

Size:

117,438 SF

Key TenantS:

Ross Dress for Less, DaVita, Wells Fargo, Carls Jr., Shoe Palace, Rainbow

Address:

10700 MacArthur Blvd.
Oakland, CA 94605

‍

Transaction Details

  • Purchased  off-market from a distressed seller whose family had run into financial  difficulty and could no longer fund leasing activity.
  • Immediately brought occupancy from 75% to 94% by providing working capital  to lease the asset effectively.
  • Successfully negotiated long term leases of the outparcels attached to the  center and sold them off at low cap rates.
  • After purchase, it was revealed that the seller had hidden environmental  issues within the asset that our national environmental DD company was unable  to uncover.  Due to the seller’s  advanced age, we were forced to settle out of court for $1.1M in damages, but  unfortunately had to spend over $3M in remediation.
  • Despite the loss of returns of $1.9M (~20% equity) and the lost value of  ~$3M due to subsequent buyer’s fears of more environmental issues, we were  still able to achieve an adequate return. This transaction serves as an example of strong asset management and smart  purchasing, which allowed us to achieve returns even in difficult  circumstances.

Property Description

Foothill Square is a 117,438 square-foot grocery-anchored shopping center in Oakland, CA. The newly redeveloped property is anchored by a Foods Co (separately owned by Kroger) and features a lineup of national retailers, including Ross Dress for Less, Wells Fargo, Shoe Palace, Carl’s Jr., and Rainbow, along with a collection of daily needs and medical tenants, such as DaVita Dialysis. Strategically located adjacent to Interstate 580 with excellent visibility to over 165,000 cars per day.

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