GT Property has also evaluated some 140 potential acquisitions; of these it has sent out 14 letters of intents or bids. It is also considering an additional 11 prospects in-house and Phillips says the firm expects to bid on at least three or four of those.
Phillips and his partner and co-founder, Nathaniel Tower, are both veterans of the real estate development community. Phillips was an executive vice president-leasing, international and new business development with the locally based Prime Retail. Tower was chief investment officer with another local firm, Phillips Edison & Co. "Our backgrounds are complementary," Phillips says. "Mine is in leasing, operations and marketing. Nate has focused on deal making and financial engineering."
The firm is seeking to acquire under-performing shopping centers and strip malls in areas east of the Mississippi. Preferably, Phillips says, the firm would like to acquire grocery-anchored centers where the properties have been under managed over the last five years. The company would then upgrade the leasing approach, among other strategies. "Basically we want to take someone else's non-core assets and treat them as our gems."
Ideally, the firm would like between 20% to 50% vacancy rates. New developments are to focus on premium-brand factory outlets in master planned retail communities in major east coast markets and tourists destinations. The firm's acquisition strategy could also include redevelopment as well, Phillips says.
"We would be willing, for example, to demolish a empty big-box retailer at a location, such as an old K-Mart, and reconfigure it into smaller spaces." By the end of 2006, the firm expects to have closed one to two acquisitions.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
