Shopping Centers Today

APR 2015

Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)

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T H E B O T T O M L I N E $7.2 million Baer's Furniture bought the 154,000-square- foot Greater Marketplace, in Casselberry, Fla., from an undis- closed seller. Tenants include Bank of America and Planet Fitness $22 million JCR Cos. bought the 90,200-square- foot Giant-anchored Manokeek Village Center, in Accokeek, Md., from Klaff Realty. The property includes 50,000 square feet of addi- tional land $30.9 million Phillips Edison Grocery Center REIT bought North Point Landing, a 152,800-square- foot Walmart Supercenter– anchored center in Modesto, Calif., from McHenry Square Investors $39 million Retail Properties of America bought the 181,000-square- foot Cedar Park (Texas) Town Center from the Ainbinder Co. Tenants include At Home, BJ's Restaurant & Brewhouse and In-N-Out Burger $54 million Cole Capital bought the 348,500-square- foot Lafayette (Ind.) Pavilions Shopping Center from Dallas- based Invesco Real Estate. Anchors are Gander Mountain, Gordmans, Hobby Lobby and T.J.Maxx $430 million WP Glimcher sold a 49 percent stake in five of its malls, including Polaris Fashion Place, in Columbus, Ohio, to New York City–based devel- oper O'Connor Mall Partners $907 million General Growth Properties sold a 25 percent stake in the 2.2 million- square-foot Ala Moana Center, in Honolulu, to pen- sion fund manager AustralianSuper DEAL OF THE MONTH Deal Barometer W H O I S P A Y I N G H O W M U C H F O R W H A T Retail properties draw a variety of investors There is no scarcity of funding for retail development, rede- velopment or acquisition, said a panel of finance and de- velopment executives at the ICSC Open Air Conference, in Dallas."There's lots and lots of money available," said Sheridan Schechner, a managing director of New York City–based Barclays Capital. Instead of three or four lenders vying for each 'A' deal, as many as 10 are com- peting at present, he said. The conduit-lending market is exceptionally strong for 75 percent-and-above loan-to-value borrowers, with a grow- ing number of mezzanine companies ready to fill the breach, Schechner noted. Insurance companies have been aggressive too, though a little choosier about mar- kets, he said. Deals in secondary markets can still be challenging to fund, the panelists concurred. Private investors are buying at a far faster clip than public REITs, which are running on lower leverage than before the recession, said Dennis Gershenson, president and CEO of Ramco-Gershenson Properties Trust. For REITs, cap rates are typically ranging in the high 5 percent range to the mid 7 percent range, he says. Restaurants are the hottest products right now in the single-tenant, triple-net in- vestor sphere, said Kevin White, senior vice president of investment strategies and research for Phoenix-based American Realty Capital Properties. "People continued to eat out during the Great Recession, and that trend has really strengthened," he said. Health-and-fitness clubs are another popular net-lease investor target, and service-industry tenants are also garnering interest, he says. By contrast, stand- alone movie theaters, despite improved industry dynamics, are less attractive, be- cause of the difficulty in repositioning them in the event of closure, he says. Triple-net deal makers are hungry 82 S C T / A p r i l 2 0 1 5 One-year total returns SOURCE: SNL FINANCIAL –5 0 5 10 15 20 25 30 35% REIT equity REIT retail Russell 3000 1/15 3/15 11/14 9/14 7/14 5/14 3/14 S O U R C E : S N L F i N a N C i a L All REITs Retail REITs 1 2 3 4 5% 1Q '14 3Q '14 3Q '13 1Q '13 3Q '12 1Q '12 3Q '11 Same-store NOI M e dian chan ge

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