Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)
Issue link: https://sct.epubxp.com/i/654213
46 S C T / A p r i l 2 0 1 6 THE NON-PUBLICLY TRADED REIT Jeffrey S. Edison, a principal and the CEO of Cincinnati- based Phillips Edison & Co., remembers the first shopping center his company acquired: a grocery-anchored property in Danville, Va. Today the company owns and operates roughly 300 shopping centers across 34 states, through multiple in- vestment vehicles, including two public, nontraded REITs. Phillips Edison focuses on grocery- anchored shopping centers. Edison says his company was the largest ac- quirer of grocery-anchored properties in the country last year, having bought some 80 properties, though that was slower than the year before. "In 2014 we bought $1.2 billion worth of proper- ties," he said. "In 2015 we bought $800 million. For 2016 we plan to be an ac- tive participant in the market again as we continue to see attractive opportunities that align with our investment strategy, which focuses on identifying grocery-an- chored shopping centers." With all this shopping going on, one would think nothing might be left on the shelves. One would be wrong. "The mar- ket is around 30,000 centers that we would consider buying," Edison said. "If you figure that all those centers trade every 10 years, that's about 3,000 properties a year. Although shop- ping centers do go through cycles, that's still a big enough volume to find good properties." The company's aim is to buy high-quality, grocery-anchored centers with the market's No. 1 or No. 2 grocer as anchor. Phil- lips Edison hopes to grow income over a sustained period. If some companies are agnostic to the types of shopping centers acquired or are totally focused on set markets, Phillips Edison is the opposite: It is singularly focused on one product, and ex- actly where that product might be sitting is less important. "We look across the country for opportunities," said Edison. "That's because we are not focused on the macro market, we are focused on the micro market. Our shopping centers effectively service a three-mile trade area. We look at these micro markets very closely, and they can be in Indianapolis, Cincinnati or Atlanta." "There's a voracious appetite for the top 10 markets; that will be a difficult place for us to buy. There will be more opportunities in less frothy markets." j e f f r e y e d i s o n