Q4 2019333 Holcomb Ave., Ste. 300 + Reno, Nevada 89502 + 775.850.3100 + DicksonCG.com

RETAIL REPORTRENOSPARKS

SalesLeases

Investment

RENO | SPARKS RETAIL REPORT

INVESTMENT ACTIVITY

The fourth quarter posted the highest dollar volume by almost 2x for the year with $87,140,000 in sales volume over 22 transactions. Both were highs for the 2019 quarter by quarter. The most notable sale was the 10 building Sparks Galleria disposition, which accounted for roughly half of the quarter’s volume.

SHOPPING CENTERIn the Sparks Submarket, the Sparks Galleria sold for $40,650,000 ($193.18 p/sf). This 10 building shopping center totals 210,429 SF and was 88.6% leased at time of sale. CIRE Equity, based out of San Diego purchased the property. The property is anchored by Sprouts Farmers Market and Marshall Home Goods. Other tenants include GameStop, Kay Jewelers, Massage ENVY, Shorts Clips, See’s Candy, State Farm, Starbucks, and Round Table Pizza. The reported cap rate was 6.81%.

1155 W 4th St is a 64,236 SF center in Downtown Reno that sold for $5,000,000 ($77.84 p/sf). This Class C building is a mix of retail offices on the 2nd floor and ground floor. Tenants include Pizza Baron, Absolute Dental, H&R Block, among others. The center was 83.8% leased at time of sale and sold for a reported cap rate of 6.5%.

SINGLE-TENANT NET LEASEIn Downtown Reno, 1105 W 4th St sold for $2,200,000 ($842.91 p/sf) and is 100% occupied by Burger King. Burger King signed a 20-year NNN leaseback which resulted in a year 1 cap rate of 5%.

1524 Ambassador, Caughlin Preschool, in the Northwest Reno Submarket is a 7,469 SF Day Care Facility that sold for $1,715,000 ($229.62 p/sf). This property is 100% occupied and had a cap rate of 6.26% at time of sale.

In the Sparks Submarket, 215 E Prater Way sold for $1,475,000 ($612.29 p/sf). This 2,409 SF Service Repair Garage is 100% occupied by the long term tenant, Jiffy Lube. No cap rate was reported at time of sale.

4TH QUARTER 2019

RENO | SPARKS RETAIL REPORT

Address Price Details

Sparks Galleria Center210,426 SF

$40,650,000($193.18 p/sf)

CIRE Equity out of San Francisco purchased the shopping center for a cap rate of 6.81%.

Neuro Restorative3980 Lake Placid Dr.

20,083 SF

$12,550,000($624.91 p/sf)

The Convalescent Hospital contains 24 units. Located off Mount Rose Hwy. in South Reno.

8 Property Portfolio - Funeral Services $8,130,000 8 properties in Reno & Sparks.

Includes three parcels of land and 5 mortuaries.

1155 W 4th St.64,236 SF

$5,000,000($77.84 p/sf)

Class C building is retail on the first floor with office space on floor two. The center was 83.8% leased at time of sale and had a reported

cap rate of 6.5%

720 Nichols Blvd.5,168 SF

$3,570,000($690.79 p/sf) Car Wash was 100% occupied at time of sale by Marina Car Wash.

7007 S Virginia St.8,000 SF

$2,425,000($303.13 p/sf)

The three tenant retail building was 100% occupied at time of sale 6.50% Cap Rate

Burger King1105 W 4th St.

2,610 SF

$2,200,000($842.91 p/sf)

Burger King signed a 20-year NNN leaseback.5.00% Cap Rate.

NOTABLE SALES Retail sales were slow again in August, with the only two notable sales taking place in the Midtown area. DCG represented the buyer of two buildings totaling 14,327 sf in the Plumgate Shopping Center. The acquisition price for both buildings was $3,500,000 ($244 p/sf). Tenants include Bobby Pages Dry Cleaners, Butcher Boy, Swoon A Bridal, Studio Phi, Core 4 Personal Training, Wink Lash Studio, Way to Go, and recently signed Larkellen. In the heart of Midtown, the 7,707 sf retail building at 1085 S. Virginia St. traded for $1,500,000 ($195 p/sf) with a reported NOI of $120,000, yielding an 8% cap rate. The main tenant was Blum Medical Dispensary.

September - South Reno saw a number of smaller investment sales take place, including the REO sale of Sierra Meadows Plaza. The 50,708 square foot center at 7111 S. Virginia Street was acquired for $5,200,000 ($103 p/sf). The property is comprised of four buildings and was 65% occupied at the time of sale. Tenants include Bistro 7, All Creatures Vet Care, Reno Family Physicians, Miracle Ear, Corbin Chiropractic, and LabCorp.

Two fully leased buildings totaling 17,388 square feet at Southwest Galleria on Longley Lane near S. Virginia Street sold in a 1031 exchange for $4,190,000 ($241 p/sf) with a 6.25% cap rate.

In the Wells Avenue District, the German and Eastern European themed Von Bismarck bar and restaurant at 805 S. Wells sold for $1,150,000 ($926 p/sf ) with a reported cap rate of 6.2%. The 1,242 square foot building was renovated in 2018 and had a 10-year term in place at the time of sale.

4TH QUARTER 2019

RENO | SPARKS RETAIL REPORT

NEW DEVELOPMENT

Overall Vacancy Rate 6.1%

Neighborhood Center Vacancy 7.7%

Power Center Vacancy 6.0%

Strip Center 4.7%

General Retail Vacancy: 4.4% Free Standing

Skypointe is a newer development by McKenzie Properties, which will be breaking ground in Summer 2020 and preleasing now. The project will include over 350,000 square feet of restaurants, cafes, retails, offices, services and hospitalities. There will be 1,300 parking spaces onsite, with an additional 900 spaces within a parking garage. The project is located at South McCarran Boulevard & South Virginia Street.

The Damonte Ranch Town Center is located at the intersection of Damonte Ranch Parkway & Steamboat Parkway, with access from the new Veterans Parkway as well. This center is anchored by RC Willey and includes The Home Depot, CVS, and Office Depot. The center will be adding Safeway to the mix, along with roughly 45,000 SF of new retail space.

MARKET FACTS & LEASING

SALES Q1 2019 Q2 2019 Q3 2019 Q4 2019

Total Volume $16,656,750 $54,398,943 $34,424,316 $87,140,000

Total Deals 13 15 19 22

Average P/SF $186 $261 $377.21 $292.87

Net Absorption 36,900 SF

The final quarter of 2019 was steady, as predicted. The largest leasing transaction this quarter was for the SPCA. They leased 18,347 SF at 75 East Moana Lane, previously occupied by Nevada Backyard. This was the only retail lease transaction this quarter, in Reno, over 10,000 SF.

2019 had a total of five retail lease transactions over 15,000 SF. There are more than 20 retail spaces, over 15,000 SF, currently on the market available for lease. We had several larger tenants close a larger retail location this year. Best Buy closed at The Legends at Sparks Marina. Goodwill relocated from The Crossing at Meadowood Square to Smithridge Center (previous Toys R Us). The Virginia Street Antique Mall closed its doors this year, vacating 17,600 SF in Midtown.

The largest retail lease transaction of 2019 was for Action Home Appliance, leasing 25,128 SF in the 3rd quarter. They joined Ross, Planet Fitness, and many more with the Silver State Plaza Shopping Center at 500 N. McCarran Blvd., Sparks, NV 89431.

4TH QUARTER 2019

SALE

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NOTABLE LEASES

NOTABLE SALES

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LEASES

SALES

4. Sparks Galleria210,426 SF$40,650,000($193.18 p/sf)

5. Neuro Restorative3980 Lake Placid Dr.20,083 SF$12,550,000($624.91 p/sf)

6. Portfolio of 8 Mortuary Locations$8,130,000

7. 1155 W 4th St.64,236 SF$5,000,000($77.84 p/sf)

1.75 East Moana LaneSPCA18,347 SF

2. 2500 N. Carson St.Carson CityUsed Auto Dealership14,139 SF

3. Crossroads Center195 E. Winnie Ln.Carson CityProminence Health Care10,080 SF

4. Fernley Village Marketplace1320-1480 N. Hwy 95AFernleyReds 395 Grill7,789 SF

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4 - 30mi.

7

8. 720 Nichols Blvd.5,168 SF$3,570,000($690.79 p/sf)

9. 7007 S Virginia St.8,000 SF$2,425,000($303.13 p/sf)

10. Burger King1105 W 4th St.2,610 SF$2,200,000($842.91 p/sf)

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5

8

9

106

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6

2 & 3 - 30mi.

RENO | SPARKS RETAIL REPORTSA

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Square Feet

NET ABSORPTION

Q1’19

Q2’19

Q3’19

VACANCY RATES

6.1%

4TH QUARTER 2019

Q4’19