Linear, Principal Retail Fund Halfway to $300M

PEABODY, MA-An eight-year-old, 30,000-sf shopping plaza in this affluent Boston suburb is the latest acquisition by Linear Retail Properties LLC and Principal Enterprise Capital. More significantly, the $7.7 million deal pushes the partnership over the halfway mark to investing $300 million of institutional capital in southern New England retail. Peabody Gardens is the venture’s fifth transaction of 2007 and 39th since the fund was launched in late 2003.

“It’s a long race, and more needs to be done, but I’m encouraged,” Linear president William Beckeman tells GlobeSt.com. Among the first locally to recognize value in assembling bite-sized retail into a diverse pool, Linear has paid no more than $13.8 million in reaching the halfway milestone, a trek focusing on convenience-oriented centers in established or emerging locations. The fund has been—and will continue—to pursue pricier opportunities, pledges Beckeman, but he says managers have been prudent in not overpaying or chasing large trophies for the sake of getting money placed. When an appropriate target has been identified, however, the team has moved quickly and paid whatever necessary to win the venture, he adds, a notion seconded by brokers handling the Peabody process.

“They offered a very strong price and worked through every potential obstacle in a diligent and thoughtful manner,” says Richard Rostoff of Spectra Realty Associates, citing the seamless conclusion as showing why Linean and Principal “have an unrivaled track record for closing deals.” Rostoff was joined in negotiating the terms by Ralph Epstein and Richard Wolfson of Patriot Properties. Principal Enterprise Capital is a subsidiary of the Principal Financial Group of Iowa.