Call Today! 256-270-9466
Call Today! 256-270-9466
Originally published: January 2023 | Updated: November 2025
Buying a shopping plaza in Huntsville, AL, means evaluating the local trade area, tenant mix, lease terms, and financial performance; completing targeted due diligence (environmental, structural, title); securing local lender financing; and executing an operations plan to increase NOI.
Commercial real estate investment in Huntsville makes sense for many folks looking for steady returns.
To pull off a successful purchase, you need to understand local market dynamics, find the right financing, do your homework, and build a management plan that fits Huntsville’s unique vibe.
Shopping center investing means you have to dig into tenant mix, lease structures, and location quirks that really matter in the Huntsville trade area.
Shopping centers for sale in Huntsville right now show five available listings. These range from cozy neighborhood strips to bigger retail complexes.
Smart investors keep an eye on high-traffic areas like Research Park, University Drive, and Memorial Parkway. Those are the places where busy businesses and growing neighborhoods keep customers coming in.
Huntsville’s shopping centers have their own flavor. The city sits right on major highways and interstates, so retail properties get great visibility.
Most shopping centers in Huntsville line the main highways and interstates. That makes it easy for customers and tenants to get in and out.
The city’s aerospace and tech jobs bring in a solid, stable crowd. People with good paychecks keep foot traffic and tenant demand healthy.
Right now, 139 shopping center investment opportunities pop up in Huntsville. That’s over 17 million square feet, worth about $154 million altogether.
There’s variety here, but not too much. You can find everything from small strips to big retail complexes.
Huntsville’s diverse economy attracts both national chains and local favorites. That keeps vacancies lower and gives you more leasing choices.
The city’s well-planned roads go a long way. Most centers make it easy to get in and out, and tenants really appreciate that.
Huntsville keeps growing, especially with new folks coming for tech jobs. These newcomers usually have more to spend, which helps retail.
Buying a shopping plaza in Huntsville takes some legwork, but it’s doable. You’ll want to follow a few key steps to get it right.
Dive into Huntsville’s commercial real estate market. There are over 9 million square feet of commercial space across 311 properties.
Figure out how much you can spend. Don’t forget the down payment, closing costs, and maybe some renovation money.
Check out listings on several sites. CityFeet has five shopping centers for sale in Huntsville right now.
Dig into the financials, tenant leases, and occupancy numbers. Don’t skip checking the property’s shape and its location.
Apply for a commercial real estate loan. Most banks want 20-30% down for these deals.
Bring in pros to inspect the place, check the legal docs, and confirm the numbers.
Put in your purchase offer based on what you’ve found. Be sure to include some outs for financing and inspections.
Finish up the final checks, get insurance, and work with a real estate attorney to transfer ownership.
Dean Commercial Real Estate can help you evaluate Huntsville shopping plazas with expert market insights and property guidance tailored to your goals. Contact us today to explore opportunities.
If you’re ready to get started, call us now!
If you want to make a smart buy, you’ve got to look at Huntsville’s demographics and traffic. The aerospace industry and suburban growth give certain spots a real advantage.
Research Park and Redstone Arsenal anchor Huntsville’s main trade zones. These areas attract the most consumer spending because aerospace and defense workers earn more than the average.
Suburbs like Harvest, Hazel Green, and East Limestone are booming. Young families move in for tech jobs, and census data shows household incomes 15-25% above the Alabama average.
Key demographic indicators include:
South Huntsville draws established families who spend steadily. North Huntsville’s new suburbs are seeing more retail demand as they grow.
Jones Valley and Five Points have more urban density but lower incomes. These spots fit value-focused retail better than high-end plazas.
University Drive sees over 40,000 cars a day—it’s the city’s main retail drag. Properties here usually command higher rents thanks to all that traffic and easy access.
Memorial Parkway handles the north-south flow between Alabama and Tennessee suburbs. Plazas at major intersections, like Memorial and University, do best because traffic converges there.
Minimum traffic for viable retail:
Huntsville’s parking ratios usually run 4-5 spaces per 1,000 square feet. Suburban spots need even more, since most folks drive everywhere.
Good visibility matters. If a property sits more than 200 feet off the main road, it’s tough to market—unless it’s got a killer anchor tenant.
Publix and Kroger really own the grocery anchor scene in Huntsville. These two pull in 60-70% of shopping center traffic, which helps smaller shops thrive.
CVS and Walgreens serve as reliable pharmacy anchors. They sign long leases and keep paying rent, even when times get tough.
Co-tenant mixes that work:
It’s smart to map out all shopping centers within three miles. Huntsville’s commercial real estate market lists 316 properties, so there’s plenty of competition.
Try to avoid crowded corridors with too many similar centers. Look for gaps in things like dry cleaning, auto shops, or specialty foods.
National chains almost always pick spots near strong anchors. They like the built-in traffic and don’t want to spend extra on marketing.
If you want to buy in Huntsville’s retail market, you’ve got to know your tenants, lease types, and the numbers. Anchor tenant stability, rent rolls, and net operating income all matter—especially with local quirks in play.
Tech workers and defense contractors keep Huntsville’s retail humming. Huntsville Plaza has anchors like Earth Fare, as well as big names like Chipotle and Guitar Center.
Top anchor categories:
Grocery anchors drive the most traffic. Households visit them 15-20 times a month, compared to just 2-3 visits for clothing stores.
Tech professionals at Research Park like convenience, so those tenants do well. Medical anchors are growing, especially as Huntsville Hospital expands and more retirees move in.
Investment-grade tenants (BBB+ or better) usually sign on for 10-20 years, with rent bumps built in. These anchors reduce vacancy risk and attract other solid tenants seeking steady foot traffic.
Most Huntsville shopping centers run on triple-net lease structures. Tenants pay a base rent and cover operating expenses, so buyers really need to dig into each rent roll detail to dodge nasty surprises.
Critical Verification Items:
| Item | Huntsville Range | Red Flags |
| Base Rent PSF | $12-$28 | Below $10 or above $30 |
| CAM Charges | $3-$7 PSF | Charges above $8 PSF |
| Tax Pass-Through | $2-$5 PSF | Unpaid amounts over 90 days |
Security Deposits: Ensure all deposits are held in separate escrow accounts. Alabama law says landlords have to return deposits within 60 days after the lease ends.
Percentage Rent: Many Huntsville retail leases include percentage rent clauses above a certain sales threshold. Restaurants usually pay about 6-8% of gross sales over $500,000 per year.
CAM Reconciliation: Always check the last two years of CAM reconciliations. Properties close to University Drive often rack up more snow removal and landscaping costs than you’d expect.
Unpaid property taxes and delinquent insurance premiums pop up on rent rolls more than you’d think. Request a certified rent roll dated within 30 days of closing.
You need detailed expense categories to calculate Net Operating Income the Huntsville way. Local property taxes and insurance rates can swing your returns quite a bit.
Sample 25,000 SF Huntsville Shopping Center:
Gross Rental Income:
Operating Expenses:
Net Operating Income: $351,550
Madison County property taxes run about 0.70% of assessed value. Insurance costs typically range from $0.35 to $0.40 per square foot if the center’s in good shape.
The vacancy allowance should reflect Huntsville’s retail market conditions, typically 5-8% for stabilized centers. Centers anchored by a grocery store tend to keep vacancy rates lower thanks to steady foot traffic.
If you’re buying a shopping plaza in Huntsville, you’ll need some local paperwork and inspections unique to Madison County and Alabama rules.
The Huntsville Inspection Department enforces building codes and issues permits required for commercial real estate deals.
Grab property tax records from the Madison County Revenue Commissioner. Five years of tax statements help spot trends and confirm the current assessment.
Essential Huntsville Documents:
Huntsville Utilities gives you detailed energy consumption data for each tenant. That’s handy for figuring out operating expenses and finding ways to save energy.
Signed leases should spell out CAM charges and what tenants are responsible for. Huntsville shopping centers often have lease clauses about parking lot maintenance and snow removal, which can hit your bottom line.
Phase I environmental reports in Madison County focus on past land use and possible contamination from old industrial sites. The Tennessee Valley has its own environmental quirks compared to the rest of Alabama.
Madison County records track land use back to early agriculture and manufacturing. Properties near Research Park or old factories need extra environmental review.
Key Madison County Environmental Factors:
Municipal permits and standards in Huntsville include air-quality permits and some very specific construction rules. Every tenant space needs a current certificate of occupancy.
The city asks for engineering reviews if the property has drainage problems or if you’re changing the parking lot. These reviews can slow down closing if you don’t get them started early.
Huntsville has its own set of rules and timelines for commercial building inspections. Licensed contractors and subs must perform the inspection work and follow city building codes.
Recommended Inspection Timeline:
The Huntsville Inspection Department keeps lists of licensed contractors for commercial work. Always check licenses before you hire anyone for inspections.
Older Huntsville shopping centers often need MEP (mechanical, electrical, and plumbing) upgrades to comply with code. HVAC systems built for Alabama’s muggy weather need extra attention for moisture and efficiency.
Structural inspections zero in on foundation stability—limestone soil in Madison County can be tricky. Parking lot drainage and weatherproofing the building envelope are important for long-term upkeep.
Get personalized investment support from Dean Commercial Real Estate to analyze tenant mix, financials, and value-add potential for Huntsville retail centers. Contact us now for expert guidance.
If you’re ready to get started, call us now!
Most Huntsville shopping plaza deals need 70-80% loan-to-value financing from commercial real estate lenders.
Local and national lenders don’t always weigh tenant credit the same way—regional banks really care about government contractor stability and aerospace ties.
Regional Bank Approach:
Banks like Regions and BBVA lean on local market knowledge. They know Huntsville’s defense contractor workforce and tend to offer more flexible terms for plazas with strong anchor tenants.
National Lender Characteristics:
Huntsville commercial mortgage rates hovered around 5.11% as of October 2025. National lenders usually offer slightly lower rates, but they want stronger borrowers and deals above $2 million.
Huntsville lenders look for certain tenant types when sizing up shopping plaza loans.
Preferred Tenant Types:
Local banks closely monitor employment numbers at Redstone Arsenal. Properties that serve contractor families get better treatment during underwriting.
Lenders keep an eye on Madison County’s 1.2% annual growth rate, especially near Research Park. They seem to prefer locations within 5 miles of major employers or along University Drive.
Financial Metrics Emphasis:
Local developers team up with out-of-state investors for Huntsville retail deals. The split is usually 70/30 or 80/20, with local partners bringing market knowledge and handling management.
Syndication Benefits:
Huntsville’s steady retail market attracts 1031 exchange buyers from pricier areas. Properties near Madison and Jones Valley tend to deliver reliable cash flow for exchange needs.
Some investors mix seller financing with traditional loans. Sellers sometimes carry a 10-15% second mortgage at decent rates, lowering the upfront cash needed and boosting returns on stabilized centers.
New plaza owners should focus on building strong tenant relationships, transferring key vendor contracts, and making visible improvements that show they’re engaged managers.
A solid 30-60-90-day onboarding plan keeps things running smoothly and helps build tenant trust.
Good tenant communication starts right away with branded templates that fit the Huntsville market. Owners should have standard messages ready for rent notices, maintenance updates, and community news.
Essential Communication Templates:
Each template should mention Huntsville and give local contact info. Tenants want to know their manager understands the local scene.
Keep the tone professional but friendly. Many Huntsville plaza owners find that holding quarterly tenant meetings works better than just sending emails.
Key messaging elements include response times, after-hours contacts, and clear escalation steps. Have a local attorney review the templates to ensure they comply with Alabama landlord-tenant law.
Contract transfers need fast action during the first month of ownership. The previous owner usually hands over a vendor list, but it’s smart for new owners to double-check all contract terms and service levels themselves.
Priority Service Contracts:
| Service Type | Timeline | Local Considerations |
| Landscaping | Week 1 | Summer heat requires frequent watering |
| Waste Management | Day 1 | Verify pickup schedules with tenants |
| Snow/Ice Removal | Week 2 | Huntsville gets occasional winter weather |
| Security | Day 1 | Review camera systems and monitoring |
Huntsville’s climate makes reliable landscaping services a must through those brutal summers. Owners should check that irrigation systems actually work before the hottest months hit.
Winter weather prep slips through the cracks in Alabama, honestly. Even one ice storm can turn walkways and parking areas into a real liability headache if no one’s maintaining them.
Vendor evaluation criteria should cover local references, insurance coverage, and response times. Plenty of plaza owners here prefer vendors who already handle other commercial properties in Huntsville.
Visible improvements in the first 90 days show tenants and customers that someone’s paying attention. Small updates can yield a surprising return on investment compared to big renovations.
High-Impact Quick Wins:
Signage updates have to meet Huntsville zoning rules. The city enforces specific limits on sign size, lighting, and placement; these change by zoning district.
Community event activations can drive more foot traffic to tenant businesses. Honestly, even simple events like farmers’ markets or holiday celebrations pique people’s curiosity about the plaza.
Budget-friendly improvements like new doormats, updated light fixtures, or seasonal decorations cost little but make a place feel well-managed and cared for.
Some Huntsville plaza owners notice that tenants will chip in for community events if they see more customers coming in. Partnerships often just happen naturally when owners show they care about the property’s success.
Smart investors focus on tenant mix and timing to get the best returns on shopping plaza investments.
Huntsville’s aerospace and manufacturing economy opens up unique opportunities for service-based retail, while market timing can make or break your exit strategy.
Huntsville’s growing population and well-paid aerospace workers drive demand for medical and personal service tenants. These businesses usually sign longer leases and pay higher rents than traditional retailers.
Medical tenants bring the most stability. Urgent care clinics, dental offices, and specialty practices want ground-floor spaces with good parking. They often sign 10-15 year leases at $25-35 per square foot.
Personal services fill smaller units nicely. Salons, spas, and fitness studios fit well in spaces from 1,200 to 3,000 square feet. These tenants typically pay $18-28 per square foot with 5-7 year terms.
Value-add strategies work best when investors upgrade common areas and modernize HVAC systems. Medical tenants, especially, need reliable climate control and updated electrical systems.
The trick is attracting tenants who serve Huntsville’s demographic. Aerospace engineers and defense contractors have additional income from premium services, so the right tenant mix generates steady cash flow even when the economy stumbles.
Market timing depends on cap rates and cash flow. Investors should keep an eye on these key signals:
Refinancing makes sense when:
Selling looks good when:
Right now, Huntsville shopping centers trade at cap rates of 7.2-8.5%. Feels like a balanced market where both options can work.
Investors should run the numbers on after-tax cash flow for each path. Refinancing lets you keep ownership and tap equity, while selling gives you full liquidity but triggers capital gains taxes.
Alabama offers commercial real estate investors a pretty good tax deal. The state doesn’t tack on any capital gains tax beyond what the federal government already requires.
One thousand thirty-one exchanges really stand out as the top tax deferral move. To pull one off, investors need to identify replacement properties within 45 days.
Then, they’ve got to close the deal within 180 days. Shopping plazas count as like-kind property, so you can swap them for other commercial real estate.
Depreciation recapture is applied at a 25% federal rate when you sell. For example, if you sell a $2 million plaza and have $400,000 in accumulated depreciation, you’ll face about $100,000 in recapture taxes.
Alabama property taxes usually run around 0.4% of the assessed value. Most counties assess commercial buildings at 20% of the market value.
That shakes out to effective property tax rates near 0.8%. Not the worst, honestly.
Timing can make a big difference for your tax bill. If you sell in December, you’ll face tax liability right away.
But if you wait until January, you push those taxes out for a whole year. Professional exit planning can help you nail down the best timing and structure.
It’s smart to talk with a tax pro before making any big exit decisions. A little planning now might save you thousands later.
At Dean Commercial Real Estate, we guide you through every step of purchasing a shopping plaza in Huntsville, AL.
Our team closely monitors the Huntsville retail landscape—including traffic patterns, tenant performance, and local cap-rate trends—so you make decisions backed by real, market-specific intelligence.
We help you identify the right opportunities —from listed properties to off-market shopping centers—aligned with your investment goals.
Our experts conduct in-depth financial and lease analysis, reviewing rent rolls, CAM structures, and tenant risk to uncover strengths, weaknesses, and hidden value.
We also manage the entire due diligence process on your behalf, coordinating inspections, environmental reports, zoning verification, and title review with trusted Huntsville vendors.
When it’s time to negotiate, we work to strengthen your offer, secure better terms, and pursue seller concessions where appropriate.
After closing, we continue supporting you with post-acquisition guidance, including tenant onboarding, vendor transitions, rent-collection setup, and value-add recommendations to help increase NOI from day one.
Secure the right Huntsville shopping plaza with confidence using Dean Commercial Real Estate’s full-service acquisition support from screening to closing. Schedule an appointment with our team today.
What are the key steps to buying a shopping plaza?
To buy a shopping plaza, you should: (1) define investment criteria (location, size, returns); (2) screen and evaluate properties (tenant mix, trade area, condition); (3) perform full due diligence (rent roll, leases, inspection, title); (4) secure financing and negotiate terms; and (5) close the deal and implement an operational value-add plan.
How do you determine the value of a shopping plaza?
You determine value by calculating net operating income (NOI) and applying a market cap rate (Value = NOI ÷ cap rate), then cross-checking the result with comparable sales and cost approach estimates. Key inputs include rent roll, vacancy rate, operating expenses, tenant lease terms, and local cap-rate benchmarks.
What should be included in a due diligence checklist for a shopping plaza?
A due diligence checklist should include: verifying the rent roll and lease expirations; reviewing CAM/NNN expense pass-throughs; obtaining Phase I/II environmental reports; inspecting structural and mechanical systems; checking zoning and title records; and modelling worst-case vacancy and CAPEX scenarios.
What financing options are available for purchasing a shopping plaza?
Financing options include traditional commercial bank loans (often 65-75% loan-to-value for retail centres), CMBS loans, bridge financing for value-add deals, and joint-venture/syndication structures. Additionally, U.S. investors may use a 1031 exchange to defer capital gains when acquiring a shopping plaza.
How do you evaluate tenant mix when buying a shopping plaza?
Evaluate tenant mix by checking for anchor tenants (e.g., grocery, pharmacy), reviewing lease lengths and stability, assessing tenant diversification (not overly dependent on one category), examining co-tenancy and exclusivity clauses, and ensuring rent escalations and minimal rollover risk are built into leases.
What are common mistakes to avoid when buying a shopping plaza?
Common mistakes include: underestimating deferred CAPEX (roofing, HVAC, parking), ignoring lease-expiration concentration, failing to stress-test vacancy scenarios, overlooking CAM/NNN pass-through risk, and skipping the regional market analysis (population trends, traffic, competition).
What is a good cap rate for a shopping plaza in today’s market?
A “good” cap rate for a shopping plaza depends on location, tenant strength, property condition, and lease terms. As a rule of thumb, well-leased neighborhood retail centers might trade in the high 5% to low 7% range in strong U.S. markets; secondary assets or value-add deals may demand returns of 7%+ or more. Always benchmark regional cap rates before making offers.
