2801 West Kennewick Avenue | Kennewick, WAIn May 2000, PMF acquired a well located Safeway anchored shopping center for $7,200,000 which was comprised of $5,000,000 of debt. The center had been underperforming and had one large vacancy (35,000 square feet) and several smaller vacancies. PMF immediately recognized this outstanding opportunity to create substantial value. While still in escrow PMF was able to receive a commitment from Safeway to expand their present store to a 61,000 square foot format and execute a new lease. In addition, PMF helped Safeway accomplish their goal of getting a gas station and signed a ground lease.
Once PMF closed on the asset PMF promptly secured tenancy for the 35,000 square foot vacancy to Big Lots and Dollar Tree. New tenants were attracted to the updated center and PMF quickly got the attention of Payless Shoes, GNC and Mail Boxes Etc. The acquisition also included a vacant lot that PMF was able to sell for $500,000 reducing its basis and cash investment in the shopping center. Once the Safeway expansion was completed PMF proceeded to undertake a major renovation to the shopping center façade. The initial cash investment less the lot sale and adding the cost of the facelift the shopping center was producing approximately 40% annual cash flow after debt service. Through its years of ownership, PMF continued to upgrade the tenancy and extend various leases putting it in favorable position to either continue to hold for an additional extended time or procure a sale.
In the fall of 2013 after reviewing the real estate market in the Tri Cities (Kennewick) and its existing tenancy, PMF agreed to sell the shopping center for $22 million and took the proceeds from the sale and acquired a new Federal Express Distribution Center in Redmond, WA.
