Whitestone REIT announced the acquisition of Scottsdale Commons in Scottsdale, Arizona for $22.2 million. Scottsdale Commons sits on the second most trafficked intersection in Scottsdale and acts as a gateway linking North Scottsdale and Paradise Valley. The 69,000 square foot center is 96.6% occupied with 20 tenants including Rosati’s Chicago Pizza, specialty butcher Rusty Nail Meats, pet care service provider Companion Pet Partners and BevMo which serve a surrounding community with a 3-mile average household income of $138k.
“Whitestone has the perfect opportunity to leverage our leasing and operations skills in order to drive performance at Scottsdale Commons,” said Whitestone REIT COO, Christine Mastandrea in a statement. “We have a great team and a strong presence in the Scottsdale market. This acquisition is accretive on day one and we believe our team can add significant additional value.”
The acquisition is funded through Whitestone’s capital recycling program, which is intended to improve the overall quality of its portfolio through targeted dispositions and the acquisition of greater long-term value properties. The program began in 2022, is intended to match disposition proceeds with acquisition funding amounts, and now totals over $100 million in acquisitions with an annual base rent of approximately $27 per square foot and combined capitalization rate of 7.1% based on actual or projected year one NOI. The properties sold to date have an annual base rent per square foot of approximately $18 and were sold at an aggregate capitalization rate of 6.2%, based on trailing twelve-month NOI.
