San Jose shopping center sells for less than assessed value

Kimco gets $33M for Monterey Plaza; new owner sees chance for value-add

San Jose Retail Center Fetches Less Than Assessed Value

A photo illustration of Kimco Realty CEO Conor C. Flynn and 5502-5568 Monterey Highway in San Jose (Getty, Kimco Realty, LoopNet)

An outdoor mall along the 101 Freeway in San Jose has sold for around half of its assessed value, fetching $33 million to put the price around $185 per square foot.

Monterey Plaza has a 29 percent vacancy rate, and the Southern California investor that bought the 23-acre center sees a chance to add value by shifting the mix of tenants with new additions, the San Jose Mercury News reports.

Jericho, N.Y.-based Kimco Realty sold the center — where the current tenant lineup ranges from a City Sports Club fitness center to a Dollar Tree discount store and a McDonald’s — to Brixton Capital in Solano Beach.

The new owner plans an exterior and landscape makeover while it seeks a tenant to replace a recently departed Wal-Mart store.

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“With the center’s current 71 percent occupancy rate, there are significant opportunities for our team to drive value through lease-up of vacant space and improve the shopping experience for local residents with new retail operators,” Dan Sutherland, managing director of investments at Brixton, told the publication.

Brixton has a portfolio of commercial and multifamily properties across the U.S., with more than 40 in California, including seven in the Bay Area.

The value of the 178,200-square-foot Monterey Plaza, located at 5502 through 5568 Monterey Highway, was assessed at $57 million at the start of the year, according to Santa Clara County.

Brixton got a $23.5 million loan from California Bank & Trust for the purchase.

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