TULSA – A group of Los Angeles investors paid $14.1 million for Owasso’s one-year-old Garrett Creek shopping center.
Tulsa County Courthouse records show Hollywood Continental Apartments LLC of L.A. paid $135.77 per square foot to Hawkeye Development LLC of Owasso for the 104,216-square-foot center.
That 13.8-acre 1031-exchange deal represented a strong premium from Garrett Creek’s estimated $10.5 million construction price, validating its anchor position to a new retail crossroads in the northern Tulsa suburb. But analyst Darren Currin said the sale price reflected current trends.
“We have seen some recently built shopping centers sold for significantly more than that,” said Currin, the vice president and research director for OKC Property Research LLC, who considered the $135 amount about average. “The ones that have gone for higher prices may have gone for more tenants with triple-net leases. Prices are definitely varying somewhat. It seems like each property has its own unique value for why it achieves the prices it does.”
In this case, that “unique value” reflects two factors: regional growth and housing starts.
Built at the intersection of U.S. Highway 169 and State Highway 20, also known as 116th Street North, Garrett Creek stands at the crossroads of major arteries connecting Owasso to Collinsville, Bartlesville and Claremore. The state is now widening Highway 20 to four lanes, which should strengthen traffic at an intersection that already sees 38,000 cars daily.
Owasso development firm Group Blaksley saw the location’s potential when it started work on Garrett Creek five years ago, plotting a 150-acre development including not only retail, but a residential subdivision.
Getting the phase-one final plat approved in February 2003, two years later Group Blaksley announced its intention to build 125,000 square feet of retail space anchored by a 48,000-square-foot Reasor’s grocery.
But since the location rested at Owasso’s northern edge, two miles from where a Wal-Mart Supercenter and Smith Farms Marketplace would lead several million square feet of new retail construction along the dominant 96th Street retail corridor, the developers faced difficulties getting Garrett Creek off the ground.
Former Owasso economic director Rickey Hayes showed the site to several potential retailers, including J.C. Penney, that ended up at Smith Farms.
“Everybody saw the validity of the location,” said Hayes, now the owner of Retail Attractions LLC in Owasso. “They just didn’t want to be the first one there.”
Group Blaksley also launched The Falls at Garrett Creek subdivision in 2005. With 62 of its 109 lots now under development or built out, analyst Mandy Vavrinak said the subdivision provided a foundation for the retail – as did neighboring development in Collinsville, Skiatook and other communities.
“You build the rooftops, the retail will follow,” said Vavrinak, owner of Crossroads Communications of Tulsa.
Last year Reasor’s again announced plans to build in the phase-one Garrett Creek center, pointing to the growth Vavrinak cited. The center opened last fall, with Meridian Capital Group providing $10.5 million in financing.
“Since Reasor’s came to anchor there, there’s been a flurry of activity there,” said Hayes.
Garrett Creek stands 100-percent leased, with developer Group Blaksley and Frisbee Real estate now offering lots on Loop.Net for the center’s 300,000-square-foot second phase.
Collin Plume, the listing agent with Investment Real Estate Associates of Encino, Calif., said the Los Angeles buyers appreciated a region still supporting single-family home construction.
“It just seemed like an area that is waiting to kind of explode,” said Plume, who represented the seller, Group Blaksley. “They just felt it was a great area, a good expansion from outside of Tulsa. They also thought the Reasor’s store was beautiful. Really state-of-the-art, very clean.”