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Pine Tree Makes Its Biggest Acquisition Yet in $644M Deal, and Nuveen and PSP Form $790M JV
Kroger Plans 110 New Grocery Stores Through 2029
3 Retailers, 3 Strategies: Hermès Heads to the Suburbs, Nordstrom Rack Returns to San Francisco and Fanatics Enters Mixed-Use
2 High-Street Bright Spots: Busiest Q3 in 4 Years and a $216M SoHo Refi
Pine Tree Makes Its Biggest Acquisition Yet in $644M Deal, and Nuveen and PSP Form $790M JV
Large deals involving primarily grocery-anchored retail keep popping up. Pine Tree and an institutional investor purchased 10 mostly grocery-anchored properties valued at $644 million, and PSP Investments and Nuveen Real Estate already have acquired 19 properties through a $790 million joint venture announced just this week.
Pine Tree and Partner Buy 10 Primarily Grocery-Anchored Centers Valued at $644M
Pine Tree and an institutional investor bought the sponsor interest in a 10-property portfolio of primarily grocery-anchored centers valued at $644 million. Site Centers sold the 3.5 million-square-foot portfolio. Pine Tree co-founder and CEO Peter Borzak said the deal was the single largest transaction in the company’s 31-year history. The transaction pushes Pine Tree’s acquisition activity over the past 12 months to more than $1 billion. Pine Tree now owns and operates nearly 70 open-air centers.
Pine Tree and an institutional investor acquired the 525,000-square-foot University Centre in Wilmington, North Carolina, and nine other properties from Site Centers for $644 million. Photo above and at top courtesy of CBRE
The deal follows Site Centers’ announcement that it would delist its common stock from the New York Stock Exchange by Dec. 4. The REIT has no plans to list its shares elsewhere. Site Centers continues to sell the shopping centers that remain after it spun off its unanchored, convenience-oriented properties into a new REIT, Curbline, in 2023.
PSP Investments and Nuveen Launch $790M JV To Buy Open-Air Centers
Canadian pension investor PSP Investments and investment manager Nuveen Real Estate launched a joint venture with $790 million earmarked to acquire open-air centers in the U.S. So far, PSP and Nuveen have acquired 19 properties totaling 3 million square feet in eight states.
MORE FROM C+CT: JV Wave: As Institutional Investors Demand Retail, Partnerships Give Them an Entry
The JV bought two of the properties individually: one in Virginia and the other in Arizona. It also bought two portfolios. One was an 11-property portfolio totaling 1.9 million square feet across California, Colorado and Washington. The other was a six-property portfolio totaling 801,000 square feet in markets like Dallas-Fort Worth; Fort Lauderdale, Florida; Minneapolis; Los Angeles; San Diego; and Orange County, California.
The JV targets open-air centers anchored by market- or category-dominant grocers, necessity-based retailers and providers of essential services. Geographically, the JV focuses on metro areas with solid population growth, rising household income and high barriers to entry, as well as markets where well-capitalized retailers are pursuing expansion. “Necessity-based retail has demonstrated remarkable resilience through various cycles, underpinned by consistent consumer demand for essential goods and services,” said Brian Wallick, U.S. cities retail strategy portfolio manager for Nuveen Real Estate.
FROM THE C+CT ARCHIVE: Nuveen Real Estate Has Assembled More Than $2.5B To Invest in Grocery-Anchored and Other Necessity-Based Retail
Kroger Plans 110 New Grocery Stores Through 2029
Elsewhere in the grocery sector, The Kroger Co. plans to open about 110 new grocery stores through 2029 in “attractive high-return markets,” CEO Greg Foran said at the company’s annual Analyst/Investor Day. The company didn’t specify when it would begin opening those stores. Mary Adcock, Kroger executive vice president and chief merchant and marketing officer, said the stores will come in three formats: 99,000 square feet for “high-volume, high-opportunity markets”; 75,000 square feet for a variety of markets; and 50,000 square feet for markets “where a smaller footprint makes sense.”
The Kroger Co. is on track to open 39 stores during the fiscal year ending Jan. 30, 2027. Photo credit: jetcityimage - stock.adobe.com
Foran said the grocer is on track to open 39 stores in the current fiscal year, which ends on Jan. 30. The Kroger Co. operates nearly 2,800 stores under two dozen banners in 35 states. The company’s $1.65 billion acquisition of Giant Eagle would add 197 stores and 11 standalone pharmacies.
3 Retailers, 3 Strategies: Hermès Heads to the Suburbs, Nordstrom Rack Returns to San Francisco and Fanatics Enters Mixed-Use
Luxury retailer Hermès is using data to target affluent suburbs in the U.S., Nordstrom Rack is taking another crack at San Francisco’s Union Square and Fanatics is opening its first store at a mixed-use development.
Hermès Takes Aim at Affluent U.S. Suburbs for Brick-and-Mortar Growth
Luxury retailer Hermès is targeting the suburbs for brick-and-mortar expansion in the U.S., according to The Wall Street Journal. Once located only in urban locales, the brand now is setting up shop in affluent suburbs like Manhasset on Long Island in New York; Short Hills, New Jersey; and Wilmette, Illinois. President and CEO for the Americas Diane Mahady said Hermès, which operates 45 stores nationwide, sees potential for more growth in the U.S. thanks in large part to the country’s increase in personal wealth, according to the WSJ. The French brand is analyzing ZIP code data to zero in on affluent pockets in the U.S., the WSJ reported.
Nordstrom Rack Stages San Francisco City Center Comeback
Off-price retailer Nordstrom Rack is returning to downtown San Francisco, according to Chain Store Age. The 51,500-square-foot store is set to open next fall on Stockton Street near Union Square. The store will occupy space in a building owned and managed by Invesco Real Estate. San Francisco has been without a Nordstrom or Nordstrom Rack since 2023, when the retailer closed its flagship Nordstrom at Westfield San Francisco Centre and the Nordstrom Rack on Market Street. Nordstrom Inc. operates more than 400 Nordstrom, Nordstrom Rack and Nordstrom Local stores.
Nordstrom Rack closed its store at 901 Market St., above, in 2023. The retailer plans to return to San Francisco next year with a 51,500-square-foot location near Union Square. Photo by Olaf Meister - Own work, CC BY-SA 4.0
Fanatics Will Enter the Mixed-Use Arena
Sports apparel retailer Fanatics — known for e-commerce, stadium shops and urban specialty stores like New York City’s NHL Shop — will open a store in a mixed-use development for the first time. The flagship store is expected to open next year at Atlanta’s $5 billion Centennial Yards, adjacent to State Farm Arena, home to the NBA’s Hawks. The development also is near Mercedes-Benz Stadium, home to the NFL’s Falcons, Atlanta United men’s soccer club and the coming Atlanta City women’s soccer club. Fanatics operates more than 60 brick-and-mortar stores worldwide.
MORE FROM C+CT: Stadium Districts’ Retail Appeal
This rendering shows what Centennial Yards will look like at full buildout. Rendering courtesy of CIM Group and Centennial Yards Co./Business Wire
2 High-Street Bright Spots: Busiest Q3 in 4 Years and a $216M SoHo Refi
Placer.ai found that 10 prominent U.S. high-street corridors enjoyed their busiest third quarter in four years, according to its report High-Street Corridors Gain Ground Ahead of the Holiday Rush. Across these submarkets, foot traffic increased year over year by 3.6% in July, 3.3% in August and 5.9% in September. The 10 corridors Placer analyzed were Fifth Avenue, Madison Avenue and SoHo in New York City; the Miami Design District; Union Square in San Francisco; Rodeo Drive in Beverly Hills, California; Magnificent Mile and Oak Street in Chicago; Worth Avenue in Palm Beach, Florida; and Newbury Street in Boston.
MORE FROM C+CT: The Pandemic Didn’t Kill Urban Retail, but It Sure Changed It
And a recent refinancing in one of those corridors backs up the submarket’s health. A&H Acquisitions Corp., Allied Partners and Aurora Capital secured a $216 million bridge loan to refinance the 12-story, 390,745-square-foot office-and-retail building at 568 Broadway in Manhattan’s SoHo. Hugo Boss, Athletic Propulsion Labs, GU and Equinox occupy the 70,870-square-foot retail component.
By John Egan
Contributor, Commerce + Communities Today