SRS Real Estate Partners’ national net lease group has completed the $11.875 million acquisition of a newly constructed, single-tenant property occupied by Target on behalf of a 1031 exchange buyer. The approximately 22,000-square-foot Target also includes a full-service CVS Pharmacy and Starbucks, and is located in the heart of Oak Park, Illinois, a Chicago submarket.

SRS national net lease group first vice president Britt Raymond, managing principals Matthew Mousavi and Patrick Luther and senior associate Kyle Fant represented the buyer, a private 1031 tax deferred exchange buyer from Manhattan. The seller was a Chicago-based developer. SRS secured a 5.5 percent cap rate.

“This transaction represents a shift in passive investor demand from traditional suburban NNN retail to core market assets with reduced footprints and replaceable rent,” said Raymond. “SRS provides a full-service approach to representing 1031 exchange purchasers to help underwrite, identify and transact net lease retail. The buyer utilized this service in an exchange from a New York City multifamily building into its first retail acquisition.”

“SRS’s National Net Lease Group is able to leverage offices within the two largest 1031 exchange markets in the country, New York City and Southern California, to transfer capital to national net lease product at a high volume,” Mousavi said.

Built in 2017 and located at 1129 Lake Street, the property is known as Target at The Emerson and is the ground floor retail condo component of The Emerson, a mixed-use development that includes 271 luxury residential units and a 418-space parking garage. The Target at The Emerson is situated along Lake Street, Maple Avenue and Westgate Street, is less than one-mile from Interstate 290 and is just 10 miles west of downtown Chicago.

The site is one of Target’s new urban, small format concepts serving an affluent local population. Target launched its new, small-format concept three years ago and now has eight stores open in Chicago with two more slated to open this year, and four slated for 2019.