Three Valley shopping centers have been sold by an L.A. retail developer as part of a $345 million portfolio sale and joint venture formation.
Federal Realty Investment Trust of Rockville, Md. has bought a 90 percent interest in six retail centers and a minority interest in a seventh center and is forming a joint venture with Primestor Development Inc. The L.A. developer focuses on building and operating retail centers in Latino neighborhoods.
The joint venture will have 100 percent interest in six of them plus a 25 percent stake in the seventh center. The overall purchase price includes $20 million to complete the redevelopment of the Olivo at Mission Hills at 10310 Sepulveda Blvd.
Overall, the seven centers total 1.35 million square feet and 114 acres. Valley properties include Sylmar Town Center at 12652 Glenoaks Blvd., a 148,000-square-feet center anchored by a Food 4 Less supermarket and a CVS pharmacy; Plaza Pacoima at 13520 Paxton St. a 204,000-square-feet mall anchored by Costco and Best Buy and the Olivo at Mission Hills, which has 155,000 square feet and is being renovated and improved. Space there is 87 percent preleased to tenants including Target, 24 Hour Fitness and Ross Stores Inc., and it’s expected to stabilize in 2018, according to Federal Realty.
Other portfolio properties are in Bell Gardens, Walnut Park, South El Monte and Southgate.
Overall, the six properties are 98 percent occupied.
According to Federal Realty, demand outpaces supply in the under-served areas of the centers. They are the dominant ones in their areas with little if any on-par competition and are all focal points for the communities. Additionally, they serve the growing Latino demographic, which has an increasing amount of buying power of 31 percent due to improving education levels.
The joint venture could grow in the future, Federal Realty said in a statement. Primestor will continue to lease and manage the centers. The company currently leases and manages about 2.4 million square feet
Primestor replied to a request for comment to say it had no comment on the transaction.