Pine Tree Starts Early Buy Program With $110M

NORTHBROOK, IL-Pine Tree Institutional Realty LLC, based here, has launched an early acquisition program, called Developer Early Reward Program, where the company would acquire shopping centers while they are still being developed. Pine Tree has already begun the process with the purchase of two centers for a total of approximately $110 million, principal Peter Borzak tells GlobeSt.com. Hazel Dell Town Center, in Vancouver, WA, was purchased for more than $60 million from Los Angeles, CA-based Kimco Developers Inc. Shops at Walnut Creek, in Westminster, CO, was purchased for less than $50 million from Kansas City, MO-based RED Development LLC. Cap rates for both purchases were “in the 6′s,” Borzak says. Scott Goldman, vice president of acquisitions for Pine Tree, represented the purchaser for both acquisitions.

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.”