Shopping Centers Today International

APR 2016

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

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shopping center in the Florida mar- ket. "When we look at the necessity- based nature of the grocery-anchored shopping center business," Edison said, "we think it is one of those real estate products that is more resistant to recession, and that is why it has been such a good mix for the non- traded REIT investor." THE INTERNATIONAL BUYER Israel is a small country, and thus any expansion-minded corporate entity there must be as much a player overseas as at home. Such was the situation with publicly traded Big Shopping Centers, which set up some overseas subsidiaries, most notably in the U.S.: Big Shopping Centers USA operates out of Beverly Hills, Calif., usually as an equity partner with developers and investors. "Being in a small market, the parent company needed to grow, and one of the oppor- tunities was to expand in the United States," said Stan McElroy, president of Big Shopping Centers USA. "So the par- ent company has been sending capital to its U.S. subsidiary." In Israel Big Shopping Centers is a fully integrated development, leas- ing, management and marketing com- pany — "the gold standard in Israel," in McElroy's words. In the U.S., though, its business model is different: The U.S. subsidiary forms partnerships with devel- opers and operators of quality shopping centers across the country. Among its partners in the U.S. are New Hyde Park, N.Y.–based Kimco Realty Corp. and Marietta, Ga.–based Columbia Prop- erties. Last year the company formed a joint venture with RED Development, of Phoenix, to acquire community, lifestyle and power centers across the country. The venture's inaugural invest- ment included four shopping centers, at an aggregate 1.5 million square feet, in Omaha, Neb., and Phoenix. Big Shopping Centers has been oper- ating in the U.S. through this model for about five years and recently surpassed roughly $1 billion in assets across 25 shopping centers and some 6.4 million square feet. "The Israel parent looks for ground and builds a center; in the United States we look for existing cen- ters in trade areas that offer long-term vi- ability," McElroy said. "The capital that is coming from Israel is long-term capi- A p r i l 2 0 1 6 / S C T 51

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