Allied Partners buys Walgreens in Miami Beach for $33M

Nearly 23K sf building was on the market for $36M with an NOI of $1.6M

Miami /
Sep.September 05, 2019 12:30 PM
509 Collins Avenue and brokers Gabriel Britti, Ricardo Esteves and Ronnie Issenberg (Credit: Marcus & Millichap)

509 Collins Avenue and brokers Gabriel Britti, Ricardo Esteves and Ronnie Issenberg (Credit: Marcus & Millichap)

Investor Sam Herzberg sold a Walgreens-leased property on the corner of Collins Avenue and Fifth Street in Miami Beach to Allied Partners for $33 million.

Property records show Herzberg’s D&R Design District LLC sold the two-story 22,875-square-foot building at 509 Collins Avenue. Walgreens has more than 14 years left on its triple-net lease with rare rental increases, according to Marcus & Millichap, plus extension options. The Commercial Observer first reported the sale to Allied Partners.

It was on the market for $36 million with a net operating income of $1.62 million, according to Crexi.

For New York-based Allied Partners, the property adds to its holdings in Miami Beach. The real estate firm also owns the Savoy Hotel and a development site at 400 Collins Avenue, both near Walgreens.

Herzberg’s company paid $32 million for the Walgreens building in 2014, according to property records. It was built in 1995 on a corner 15,000-square-foot lot.

Herzberg owns the Sterling Building on Lincoln Road, and has proposed transforming it into a 130-room hotel. He’s also an investor in Wynwood and the Miami Design District.

A month ago, Walgreens said it planned to close about 200 stores in the United States. But the Collins Avenue store is considered a flagship for the pharmacy store chain, according to the Commercial Observer.

Gabriel Britti, Ricardo Esteves and Ronnie Issenberg of Marcus & Millichap represented both the buyer and seller.

Esteves said in a statement that investors are looking to take advantage of volatility in the equity market, low interest rates and the impact of potential trade wars.

Near the entrance to South Beach on Fifth Street, Crescent Heights and Terra are building a mixed-use tower with condos, rentals, retail space and a public park.


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