Challenge

With a great overall location, the property is located adjacent to Camarillo High School, as well as a large proposed multi-family development. The development will include 129 new townhomes. Given the substantial deal size, it was too small to interest institutional buyers and almost too large for private clients. However, Matthews™ understood that it would be critical to complete the transaction on behalf of the seller, a high-profile client, with a reverse exchange that needed to be executed by March 17^th, 2017.

Strategy

Matthews™ created the best-in-class marketing material and formulated a strategy that fully exposed the asset prior to going to market. Utilizing the “Breaking up of Retail Strategy,” Matthews™ leveraged the separation of the five individual parcels to provide new investors with the opportunity to sell off assets to raise capital or be accretive to current costs basis. With the clout of recently selling a property located down the street at a record-breaking cap rate, Matthews™ was able to use the transaction to support the value of the entire shopping center. Through a heavy marketing push prior, the team generated interest in the pads and were focused on getting multiple buyers lined up in the event one could not perform. This provided the seller with the confidence that Matthews™ would yield certainty of execution.

Results

By working with Matthews™, the property generated several offers equip to satisfy the client’s reverse exchange time frame. Given the amount of interest and the foreseen challenges, during the buyer selection, Matthews™ recommended that the client proceeds with a private exchange buyer rather than the institutional buyer; however, the client had previously transaction with the same institutional buyer and their equity partner was familiar with the buyer. As foreseen, the institutional buyer re-traded the price and terms by $1.2M on the $19M deal with ten days left before the March 17^th exchange deadline. The team canceled escrow on March 8^th, opened escrow with the exchange buyer on March 10^th, and closed the transaction on March 16^th at $18.8M. By identifying the challenges in the beginning and generating multiple offers, Matthews™ improved the client’s position and presented $1M of value for the client.