Ian Ritter is national online editor of GlobeSt.RETAIL.
NEW YORK CITY-Acadia Realty Trust invested $23.2 million in the Mervyn's department store chain during this year's third quarter. The deal was the company's first in its Retailer Controlled Property Venture launched earlier this year to fund retail chains.
Mervyn's operates 257 department stores, mostly on the West Coast. The chain was sold by Target to a partnership between Cerberus Capital Management, Lubert-Adler/Klaff and Sun Capital Partners in the summer for nearly $1.3 billion.
Acadia, based here, also launched its New York Urban/Infill program during the quarter. The program, in which the company invests a 90% share and developer P/A Associates funds the remainder, acquired the 400 East Fordham Rd. in the Bronx for $30 million. The six-story mixed-use building is anchored by a two-level Sears.
In the infill program Acadia also plans to redevelop 320,000 sf of warehouse space in Pelham Manor, NY, into a 200,000-sf multi-anchored community center. The REIT expects the project to cost between $30 million and $40 million. Acadia plans to do an average of two infill projects a year, company officials say. "National retailers are under represented in this market," said Kenneth Bernstein, Acadia's president and CEO, during a conference call with analysts and investors.
Acadia's portfolio of 70 properties was 89.1% occupied during the quarter, an increase of 1.3% over the same year-ago period. The company's funds from operations was $7.2 million, up from $6.7 million.
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