JACKSONVILLE, FL-Locally based Regency Centers Corp., led by chairman and CEO Martin Stein, has closed the first phase of the Regency Retail Partners LP fund, which is expected to have a total capitalization of approximately $1.2 billion when fully invested.

The open-ended, infinite-life fund will acquire Regency-developed large format community centers upon stabilization that meet the company's investment criteria. Regency will act as general manager of the fund and will receive asset management, property management and leasing fees consistent with its other institutional partnerships. When fully invested the fund will have approximately 60% leverage. Regency's current ownership in the fund is approximately 27%, which it expects to reduce to an ongoing ownership of 20%.

At closing, two properties were contributed to the fund at a combined acquisition price of $72.6 million and a weighted average cap rate of 6.36%. The properties were Falcon Ridge Town Center Phase I, a 370,000-sf center anchored by Target and Slater Bros. in Riverside-San Bernardino, CA and Indian Springs Market Center, a 349,000-sf center anchored by Wal-Mart Supercenter in Cincinnati. Both centers are 100% leased.

M3 Capital Partners LLC, which was formerly Macquarie Capital Partners LLC, and Eastdil Secured acted as financial advisors to the fund. King & Spalding LLP acted as legal counsel.