Thursday, July 14, 2011

Part of Scottsdale Promenade purchased

A California real-estate-investment trust finalized a $110 million acquisition deal Monday afternoon to buy retail portions of the Promenade, one of the most prominent outdoor shopping centers in Scottsdale.

Excel Trust Inc. purchased roughly 60 percent, or 433,000 square feet, of the center's retail space - which includes anchors Nordstrom Rack, Trader Joe's and Old Navy - from former billboard executive Bill Levine. Excluded from the sale were spaces currently owned and occupied by Lowe's Home Improvement and the Great Indoors. A few miles north of Kierland Commons and the new Scottsdale Quarter shopping center, the 51-acre plaza is at the southeastern corner of Scottsdale Road and Frank Lloyd Wright Boulevard where it's landmarked by a tall, glowing blue spire designed by Frank Lloyd Wright.

"It's a very strong-performing property," said Mark Lucescu, president of Lucescu Realty in Newport Beach, Calif., who represented Levine in the sale.

He said the project was at least 97 percent leased, mostly by regional and national chains.

Levine bought the center in 2005 for about $123 million from the Pederson Group, which built the project in 1999. He sold it because he wanted to move on to other things and "felt it was the right timing," Lucescu said.

In the sale, Excel Trust also assumed a $52 million securitized loan as well as the tenant lease agreements, which will remain unchanged, he said. Daily operations will also not change as a result of the sale. It also plans to open an on-site management office at the plaza.

Excel Trust is a publicly traded REIT on the New York Stock Exchange that focuses on acquiring, managing, owning and developing neighborhood power centers and freestanding retail properties nationwide that have long-term viability. At the end of the first quarter, it had assets valued at $470 million.

In its first-quarter earnings call with analysts in May, Excel Trust's CEO Gary Sabin called the Promenade "one of the nicest properties in Scottsdale" and "the bastion of retail strength," even during the height of the recession.

The firm, based in San Diego, partly funded the transaction through $150.2 million in net proceeds from a recent public offering of its common stock, which closed on June 29, according to its Securities and Exchange Commission filings.

by Kristena Hansen The Arizona Republic Jul. 13, 2011 12:00 AM

Part of Scottsdale Promenade purchased

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