Phillips Edison Pays $44M for Sacramento-Area Retail Center

Quail Pointe was 94 percent leased at the time of sale. Image courtesy of JLL

Phillips Edison & Co. has purchased Quail Pointe, a 98,314-square-foot grocery-anchored retail center in the Sacramento suburb of Fair Oaks, Calif., for $44.3 million. JLL represented the seller, Madison/Sunrise Associates, a subsidiary of The Voit Co. This is the first time the property has changed hands in 36 years.

Completed in 1987, the property was 94 percent leased at the time of sale. Trader Joe’s, the anchor tenant, has been occupying the space for more than 30 years and has recently signed an early 5-year extension bringing its remaining lease term to 9 years. The tenant roster includes various retailers such as Calico, Willo and Starbucks, according to CommercialEdge data. The average tenancy length at the property is 20 years.

Located at 5329 Sunrise Blvd., Quail Pointe is about 1 mile north of central Fair Oaks and some 19 miles from Sacramento, Calif. The center serves a population of more than 131,000 people within a 3-mile radius with an average household income of $112,015, according to JLL.

Sacramento retail market holds steady

JLL Managing Director Eric Kathrein and Director Warren McClean, along with Analyst Andrew Spangenberg, led the Retail Capital Markets team that arranged the deal. The same brokers were recently involved in the $29 million sale of another retail center in California.

In 2023’s third quarter the total vacancy rate for retail assets in the Sacramento market clocked in at 5.5 percent, according to a recent CBRE report. Meanwhile, the average asking rate on a monthly triple-net basis registered a slight decrease from the second quarter’s $1.66 per square foot to $1.64.