$84M Financing Deal Facilitates Purchase of Sacramento Area Mall
- Mar 14, 2008
Sunrise Mall, a 1.2 million-square-foot retail property in Citrus Heights, Calif., has come under new ownership thanks largely to the orchestration of a financing package valued at $84 million. Steadfast Commercial Properties acquired the asset from Cordano Associates and Sunrise Mall Associates for over $100 million.The financing, originated by Capmark Finance Inc., came in the form of a fixed-rate loan from AXA Equitable. Located about 15 miles north of Sacramento, Sunrise Mall was originally developed in 1972 and has since undergone a handful of renovations, including a $10 million upgrade in 1999 at the hands of the sellers. Just last year, construction of a new 400-seat food court reached completion. Steadfast has plans for Sunrise Mall, too. The company intends to transform the super-regional shopping center, the fifth in its portfolio, through an expansion program and the broadening of the range of retail offerings. Steadfast’s plans for expanding Sunrise Mall fit with the current state of the local market, despite recent changes. Retail in Sacramento had been on fire for years with record growth between 2002 and 2006, but the growth spurt has lost some of its momentum over the last few quarters due to a slowing economy and a downturn in the housing market, according to a February 2008 report by real estate services firm Colliers International. But the situation isn’t exactly dire, as the average vacancy rate is 5.8 percent in metropolitan Sacramento and 6.4 percent in the Citrus Heights/Orangevale submarket. Sacramento’s regional power centers are faring even better with an average vacancy rate of just 4 percent. Newport Beach Calif.-based Steadfast owns, finances, builds and manages retail, residential, resort and office properties. The company’s retail portfolio consists of owned and operated assets located in California, Oregon and Washington accounting for an aggregate 3.5 million square feet.