Newmark arranges equity for grocery-anchored acquisitions

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Newmark has formed a joint venture (“Venture”) with Rosenthal Properties FarmViewVentures and H.I.G. Realty Partners has acquired four grocery-anchored shopping centres (the Portfolio) in Richmond, VA for $110 million. Newmark’s team was led Jordan Roeschlaub, Dusty Stolly and Chase Tagen. Hudson Barineau and Director Chase Tagen were also part of the team.

The Portfolio is 592,000 square foot and approximately 95% of it is leased out to a diverse group of tenants including Wegmans Walmart The Fresh Market Aldi. These properties have prominent frontages on major thoroughfares within their communities, and are a barrier to new retail development. The Portfolio, with its 60 tenants, provides attractive cash-on -cash yields to the Venture.

The Venture aims to offer market tenant improvements packages to tenants in order for them rent, lease term and credit quality to increase. The Portfolio is located in mature and infill areas of the Richmond Market, which have low market vacancy rate.

Roeschlaub commented that the portfolio includes some of the best credit-worthy retail tenants.

Stolly added, “This opportunity has been well received by Richmond’s capital markets community, as Richmond has seen an influx of institutional investment from pension funds, foreign investors, and private equity companies.” Richmond has benefited from the post-Covid era, as net migration and employment growth have continued to be beneficial for the regional economy.

Newmark has been focusing on equity financing for joint ventures that are single assets, platform joint ventures or programmatic joint enterprises. Capital and debt have shifted away from the traditional commercial sector and found grocery-anchored shopping centers to be very attractive from a risk adjusted perspective. This asset class is expected to continue to attract institutional interest.

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