Retail center near Phila. on block

Real Estate Alert, March 3, 2004

A partnership plans to market a retail center near Philadelphia that could command bids of up to $65 million.

The 200,000-square-foot property, called the Shoppes at Brinton Lake, has an unusual mix of tenants. It is configured like a lifestyle center in that it is unenclosed, has no large department-store anchors and has attached stores with individual entrances. But the Concordville, Pa., property also features a supermarket anchor and a drugstore. Such tenants appeal to institutional investors because of their stable performance in all kinds of economic climates. The rest of the tenant roster is made up mostly of apparel and home-furnishing stores, and a handful of restaurants.

The tenant mix will likely attract a broad range of investors, which could push the bidding to $65 million. That would translate to an initial annual yield of slightly less than 7%. Eastdil Realty has the listing.

Investors likely to take a look at the property include lifestyle players Pennsylvania Real Estate Investment and Ashkenazy Acquisitions, as well as retail operators that focus on neighborhood shopping centers, like Developers Diversified Realty and New Plan Excel.

The center is owned by Wynnewood Development of Bala Cynwyd, Pa., and Urdang & Associates Real Estate Advisors, a Plymouth Meeting, Pa., firm that advises public and corporate pension funds. The partnership built the property in two phases. The first portion was completed in 2001 and the second phase was finished last year.

Two of the center's four anchors--Clemens Family Markets and Borders Books & Music--have Leases through 2021. The other anchors are home-furnishing stores Pottery Barn and Organized Living. The anchors occupy 80,000 sf, or 40% of the center's space. Brinton's 12 in-line stores generate sales of about $350/sf. Projected net operating income for the center this year is about $4.5 million.

The center is located on Route 1, about 20 miles southwest of Philadelphia. The area within a 10-mile radius is affluent, with an average household income of $86,000.