CHICAGO—The Food 4 Less Shopping Center at the intersection of North Ave. and 25th Ave. in suburban Melrose Park has just been bought by Cole Real Estate Investments Inc. The net lease REIT paid $17.75 million to the seller, an investment partnership comprised of Chicago-based Origin Capital Partners and Newgard Development, which had paid a bit more than $11 million for the 113,624-square-foot center back in 2011, according to the Cook County Recorder of Deeds.
As reported this week in GlobeSt.com, Cole recently concluded a merger agreement with American Realty Capital Properties, Inc. that will make it into a wholly owned subsidiary of ARCP. The combined company will create the world's largest net lease REIT with an enterprise value of $21.5 billion.
A Food 4 Less store anchors the Melrose Park property and occupies 65,439-square-feet of space. A Starbucks, a FedEx and a T- Mobile occupy portions of the inline retail space, which totals 30,076-square-feet. The property also includes outparcels occupied by a Fifth Third Bank and a gas station. An Advanced Auto will occupy a third outparcel upon completion of a 14,040-square-foot distribution and retail building.
At the time Origin and Newgard purchased it from MB Financial Bank, the property, first developed in 2006, was 88% leased. Since then, occupancy increased to 95%, with 6,349-square-feet of positive absorption, and Advanced Auto executed a lease for its build-to-suit.
“From the time we acquired the Food 4 Less Shopping Center, our strategy has been to add value to the center by building occupancy and identifying other opportunities to increase cash flow,” says Origin President William Rogalla. “We fulfilled our objectives to our investors and capitalized on this opportune time to sell.”
“Grocery-anchored retail centers continue to represent a strong investment opportunity in Chicago,” says Paul Utigard, a principal of Newgard. “This center features a value-driven concept that has done well in this marketplace and is supported by a strong mix of national retailers.”
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Brian J. Rogal
Brian J. Rogal is a Chicago-based freelance writer with years of experience as an investigative reporter and editor, most notably at The Chicago Reporter, where he concentrated on housing issues. He also has written extensively on alternative energy and the payments card industry for national trade publications.
