6 retail centers on block in Mass

Real Estate Alert, May 26, 2004

An investment group is shopping six grocery-anchored shopping centers in the Boston area that have a combined value of about $120 million.

The properties, which encompass 400,000 square feet, are located in the Boston neighborhood of West Roxbury and in five nearby suburbs: Cambridge, Quincy, Medford, Plymouth and Swampscott. All but the Plymouth property are within 15 miles of downtown Boston. All six centers are situated in communities with high barriers to new construction.

Investors call bid on the whole portfolio or pieces. The centers in Medford, Plymouth and Swampscott--which encompass 156,000 sf--have an umbrella mortgage and must be purchased together. The owner, a partnership between Crosspoint Associates of Natick, Mass., and Charlesbank Capital Partners of Boston, has given the listing to CB Richard Ellis.

The portfolio's net operating income is about $8.5 million. At the expected sales price, it would provide an initial annual yield of about 7.1%.

The centers range in size from 36,000 sf to 101,000 sf. The anchor stores are all leased to Shaw's Supermarkets, but it subleases two to Star Markets and one to Whole Foods Market.

The Crosspoint group acquired the portfolio in 1998 for $60 million from Boston City Properties, an affiliate of Investcorp. The group has since improved and expanded some of the properties. Most of the centers have long-term leases that expire in either 2016 or 2026.

The portfolio is likely to attract bids from institutional investors, retail operators, high-net-worth individuals and private investment groups.