The new program allows Pine Tree "to find a way to capitalize" on all of the different parts of the company, such as acquisitions, development and construction, says Barry Herring, a principal with Pine Tree. "We just found that the bulk of the developments that we find are through other developers where they have a need for equity, a need for manpower or a need for more expertise," Herring says. With Pine Trees relationships with pension funds and in-house construction company, "it seemed like it was an easy program for us to step in to keep our acquisition program rolling," he says.

Pine Tree decided to develop the program after being approached by a broker regarding the Shops at Walnut Creek property, Borzak says. "Generally, the offers came in one of two ways. They were either full price offers from institutions that required the developer to stay involved," he says. "On the other side were developers who were offering more of a wholesale price."

The Shops at Walnut Creek, a 192,000-sf shopping center, is anchored by TJ Maxx, OfficeMax, PetSmart, Golf Galaxy and a separately-owned Super Target. The center was completed in 2006 except for the TJ Maxx and Office Max. The shopping center is currently between 93% and 94% leased with an average lease rate for the area of between $30 per sf and $35 per sf net, Borzak says. Pine Tree will probably construct an additional 15,000-sf building next year at the development, he says. The Shops at Walnut Creek was purchased as part of a joint venture with Newport, CA-based Buchanan Street Partners. John Pantone represented Buchanan Street Partners. LaSalle Bank provided permanent financing for the acquisition with the funding arranged by Bruce Ganong, of San Francisco.