By Meghan Hall
A retail center in Union City has hit the market as retail fundamentals across the Bay Area continue to improve. The Niles Creek Center, owned by Fremont, Calif.-based Shinet Corporation, is up for grabs with an asking price of $12.2 million, according to public records and Faris Lee Investments. Faris Lee describes the asset as a “rare” opportunity for investors.
The center is located at 34650 Alvarado Niles Rd. and totals 14,954 square feet. Public records show that the retail center, which is just one-story in height, was originally built in 2000. Shiner has owned the asset since 2008, according to public records, when the organization acquired the asset for $709,000.
The asset has been 100 percent leased for the past ten-plus years. Tenants include Noble Dental Care, Mountain Mike’s Pizza and Auto Zone. Faris Lee states that the property has scheduled annual rent growth of between three and four percent in the future.
The Niles Creek Center is located in a major commercial corridor along Decoto and Alvarado Niles Road. A number of other shopping centers exist nearby and are anchored by retailers such as Safeway, RiteAid, Daiso, Dollar Tree, Bank of America, and Taco Bell, among others.
Over the second quarter, retail fundamentals moderated in the East Bay. While unemployment rates trended down, so did rental rates as vacancy and construction deliveries both rose. At the end of the second quarter, 157,120 square feet of retail began construction, up from 28,296 square feet during Q1, according to a report from Kidder Mathews. An additional 176,216 square feet of space was under construction prior to the beginning of the quarter.
Vacancy rates trended up just slightly, increasing 0.1 percent to 5.1 percent. Rental rates also dipped, falling 4.68 percent year-over-year to $26.88 per square foot. However, average sales price per square foot has risen, increasing 18.67 percent to about $344.35 per square foot, Kidder Mathews reports. The market has seen a few smaller retail transactions, but thus far the market is still waiting for fundamentals to improve.
As of this writing, Faris Lee Investments had not yet returned The Registry’s request for comment.