Cedar Shopping Centers, a real estate investment trust (REIT) based in Port Washington, N.Y., has spent $91 million to buy five properties that are primarily supermarket-anchored, on behalf of a joint venture between Cedar and RioCan REIT of Toronto.
Giant Food Stores supermarkets anchor four of the properties. Three properties are located in Pennsylvania, one is in Maryland and the remaining one is in Virginia.
The properties include Gettysburg Marketplace in Gettysburg, Pa., York Marketplace in York, Pa., Northland Center in State College, Pa., Marlboro Crossroads in Upper Marlboro, Md., and Towne Crossings in Midlothian, Va.
The gross leasable area of the portfolio is approximately 678,000 sq. ft. The sellers were affiliated with the Edens & Avant group of Columbia, S.C.
The joint venture expects to arrange 10-year fixed-rate financing on the properties in the amount of $50.6 million, or approximately 55% of the purchase price, at a rate of not more than 5%.
Cedar's equity investment at closing was approximately $18.2 million, and RioCan's, approximately $72.8 million. After the buyers obtain fixed-rate mortgage financing on the properties, approximately 55% of their equity contributions are expected to be refunded.
RioCan is Canada's largest REIT, with a capitalization of approximately $10.0 billion as at Sept. 30. It has ownership interests in 280 retail properties. The REIT has an 80% interest in 19 grocery-anchored shopping centers in the United States and owns a 14% equity interest in Cedar.
Cedar focuses primarily on the ownership, operation, development and redevelopment of supermarket-anchored shopping centers in coastal mid-Atlantic and New England states.
Cedar will provide property and financial management, leasing, reporting, financing and construction management services for the properties. It has also received some acquisition fees.
The latest shopping center purchases bring the total value of properties acquired by the Cedar-RioCan joint venture to approximately $350 million to date in 2010.