The centers, which the buyers acquired from privately held M&H Realty Partners of San Francisco, will be owned by a newly formed private real estate investment trust called Centro Watt American REIT.
The acquisition represents Watt's first transaction through Real Estate Advisory Group, says Jim Maginn, CEO of locally based Watt Commercial Properties. This is Centro's first investment in the US, Maginn says, adding that it is likely just the first step in a Centro expansion into North America.
The 14 properties represent one of the largest retail portfolio acquisitions in California in recent years. The portfolio comprises six neighborhood centers, six community centers and two power centers throughout the state. Watt and Centro have formed a joint venture that is responsible for providing real estate services both to their jointly owned portfolio and to other retail properties that they may jointly develop or acquire in the future. Watt Management Co. will provide property management, leasing and asset management for the venture.
The Watt/Centro team acquired the portfolio in what Watt describes as "a highly competitive bidding process" that was managed for M&H by Eastdil Realty. The Watt team was responsible for and performed all of the due diligence and analysis on the portfolio. The strength of the due diligence and the Watt/Centro team's capability to close quickly were important reasons why the seller chose the Watt/Centro bid, according to Jim Leonetti, CFO for Watt Commercial.
The transaction was funded by equity raised in the Australian capital markets and provided by Watt. Debt was arranged through Centro and its banking relationships.
Watt Commercial Properties is one of the largest owners, developers, and managers of commercial real estate in California, with more than 10 million sf of assets under management. The company's core services include: property management, leasing, asset management, acquisition, development and reporting for all types of commercial real estate. Centro Properties Group specializes in the ownership, management and development of retail properties throughout Australia.
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