(For more retail coverage, click GlobeSt.com/RETAIL.)

HOUSTON-Locally based AmREIT is working a plan to acquire new multi-tenant properties in the Sunbelt and selling some non-core, single-tenant assets that no longer meet its acquisition criteria.

The focused approach was detailed during yesterday's Informed Investors Forum in a joint presentation by AmREIT's CEO Kerr Taylor and CFO Chad Braun. Throughout the discussion, Taylor and Braun stressed their commitment to several areas, specifically a hard focus on acquiring "irreplaceable corners"--in other words, high-quality and high-trafficked corners in highly populated areas for retail shopping centers. Taylor pointed out the buying plan targets "markets where we have experience and local market knowledge, the Sunbelt states, with an emphasis on Texas."

AmREIT's execs cited the June acquisition of Uptown Park, located at the intersection of Loop 610 and Post Oak Road in Houston as example of its buying mindset. More than 275,000 vehicles per day pass through the intersection, which is tucked into a pocket with 148,000 residents in affluent subdivisions within a three-mile radius. "Reported sales of the property are strong at approximately $450 per sf," Kerr noted. "We also have an evenly weighted rollover schedule for lease expirations."

According to Braun, AmREIT's total revenue jumped from $5.4 million in 2002 to $15.9 million in 2004. Two years ago, the REIT had $100 million in assets and last year ended with $200 million of properties in the portfolio, he said.

Braun tells GlobeSt.com that, the gross asset goals for the next 12 to 18 months will include another $200 million boost, "resulting in $400 million in total assets." Those assets, he continues, will be mainly multi-tenant retail centers. "We're 100% retail now," he explains. "No office properties, no multifamily properties, no hospitality properties. About 30% of our rental income is derived from multi-tenant shopping centers, 30 from single tenant properties."

Braun says AmREIT fully expects to heavily weight the portfolio with multi-tenant properties in the coming years. To do that, it will dispose of some single-tenant properties. The bulk is in Texas, but there is a handful scattered throughout the Midwest and Gulf Coast states. "These tend to be older assets. In the current cap rate environment, we've maxed out their value," Braun says. "We plan to capitalize on that for our shareholders, redeploy the capital into our shopping centers and then grow the value of those over time."

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM Digital Member, you’ll receive:

  • Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
  • Educational webcasts, white papers, and ebooks from industry thought leaders
  • Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Houston
Retail