The Real Deal Tristate

How much for that CVS building? In Greenwich, the price is $30M

The single-tenant retail space in the tony town secured a surprising valuation
July 29, 2019 05:15PM

The CVS at 99 Greenwich Avenue in Greenwich, Connecticut (courtesy of Midwood).

Retail’s struggles in the markets around Manhattan and elsewhere have been well documented, but some suburban spaces can still snag sums that raise eyebrows.

A large retail property at 99 Greenwich Avenue in the Connecticut town of the same name traded this month for $30 million, according to the Greenwich Time. The sale of the building, which is leased to a CVS through 2038, comes after a spate of storefront vacancies along Greenwich’s high-end shopping district.

Thomas Torelli, a broker and managing partner at Greenwich-based Allied Property Group, spoke with The Real Deal last year about how some retail tenants in the town are willing to pay top rents for stores located on prime blocks like Greenwich Avenue. Torelli told the Greenwich Time last week that the sale of the CVS building is significant because it highlights how Greenwich’s retail market has rebounded after a rough few years.

“People remember seeing empty stores two years ago,” Torelli said. “In the last 12 months, or 18 months, we’ve filled up most of those stores that were vacant with great tenants. [This deal] indicates the market is strong. Most people consider Greenwich a very good long-term investment.”

The Greenwich Time reported that 99 Greenwich Avenue has more than 10,000 square feet, although the Greenwich Free Press noted the actual square footage is closer to 16,000 when accounting for additional storage space beneath the actual CVS store. Still, that puts the sale of the building at roughly $1,875 per square foot, higher than some office buildings that have recently sold in Midtown Manhattan.

“The property drops down and in the back it’s two stories and the front is one story,” Torelli told the Free Press, noting that CVS pays a high rent, even for Greenwich. “This is a very good income stream for 17 years [to 2038].”

Midwood CEO John Usdan

CBRE vice chairman Jeffrey Dunne led a team from the brokerage representing the property’s owner, Midwood Investment & Development, on the sale and procured the buyer, an unidentified institutional investor known as Agree Greenwich LLC. (The Free Press reported that Agree Greenwich is registered to an entity based in the Detroit suburb of Bloomfield Hills, Michigan, while Midwood is run by New York-based real estate investor John Usdan.)

“The property provided a unique opportunity to purchase a high-volume, long-term CVS in one of the most prestigious retail markets in the U.S.,” Dunne said in a statement. “CVS’ lease through 2038 combined with 10 percent rent bumps every five years, will provide the purchaser with stable income for years to come.”

The Greenwich Time reported that buildings on Greenwich Avenue rarely change hands, usually trading only once or twice per year. [Greenwich Time] — Brian Baxter