Cedar would not name the seller but said it is a collection of 33 partnerships affiliated with a "substantial Ohio-based developer." The company might name the seller when the deal closes in March, Leo Ullman, Cedar's CEO, tells GSR.
Eleven of the properties are anchored by Medina, OH-based Discount Drug Mart, which average 25,000 sf. The acquisition would not be a strategy shift for Cedar, which mainly owns grocery-anchored centers, because the Drug Marts sell a substantial amount of food, Ullman says. "The properties are like our grocery-anchored centers in the sense that they're convenience shopping for people who live in the area," he said. "The idea is that it's sort of a mini Wal-Mart without the soft goods."
Other tenants in the centers include Dollar General, Staples, and TJ Maxx. The properties are 95% leased, and 10 of them are single-tenant properties. The portfolio totals 736,000 sf.
One analyst, who did not want to be identified, says the acquisition is "a little different" from other Cedar transactions and that the company's main strength is development. Cedar currently owns 31 centers totaling 4.9 million sf. The company is in a deal, expected to close this month, to buy two community centers in Hagerstown, MD for $8.3 million. Cedar is traded on the New York Stock Exchange and went public in 2003.
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