VIRGINIA BEACH, VA—A retail portfolio sale that the locally-based Armada Hoffler Properties REIT announced last month has closed with missing details filled in.
Armada Hoffler reported that it was acquiring 11 retail centers located throughout the Mid-Atlantic and south central US for $170.5 million in cash.
The portfolio is 94% leased and totaled 1.1-million square feet, it said.
It didn't provide the name of the seller, however, in it announcement. This turned out to be a partnership between DDR Corp. and TIAA-CREF.
HFF's Jim Hamilton, Richard Reid, John Owendoff, Amy Sands, Clinton Mitchell and Jordan Lex represented the seller.
The properties, called The Cavalier Portfolio, is located in the Carolinas, Virginia, Tennessee, Indiana and Texas, with most of retail centers concentrated in North Carolina. Specifically, the core of the portfolio, or 75% of the in-place net operating income, are six retail centers situated along the I-85 corridor between Raleigh-Durham, NC and Greenville, SC. This was probably the chief allure for Armada Hoffler, which has been seeking to build out a presence is this area.
Harris Teeter, Kroger, Bed Bath & Beyond, Costco, Super Target, DSW, Ross Dress for Less, Total Wine & More, Five Below, GolfSmith, Petco, PetSmart, Office Depot and Staples are among the tenants in the portfolio.
The deal's closing also filled in another blank space -- the timing of Armada Hoffler's 2016 guidance.
The REIT is funding the acquisition partly with the proceeds of two property sales - the Oceaneering Building and Richmond Tower, a 15-story, 206,969 square foot office building in downtown Richmond that went under contract for $78 million last year. During the REIT's last earnings call, executives said that they weren't sure how the proceeds of the Richmond Tower sale would be deployed and therefore would be unable to provide 2016 guidance at that time. CFO Michael O'Hara said the company would give an update once the Richmond Tower sale closed and its reinvestment plan finalized.
A spokesperson for the REIT told GlobeSt.com that it will be issuing 2016 guidance in its next earnings call on February 11. In the meantime, it has filed 8-K's including information on transactions that the analysts have used to update their models accordingly.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
