ALISO VIEJO, CA-New York-based American Realty Capital and Irvine-based ValueRock Realty Partners Inc. have formed a complex joint-venture partnership for the ownership of the Commons at Aliso Viejo Town Center here. The 181,160-square-foot multi-tenant retail center is fully occupied by Lowe's, Michaels and Tuesday Morning.

Valued at $50 million, the Commons is situated on 14.54 acres at 26501, 26053 and 26505 Aliso Creek Rd. within the Aliso Viejo Town Center, a 300-acre, 700,000-square-foot regional shopping center. Tenants at the center include a 20-screen Edwards Stadium Theatre, Ralphs Fresh Fare, Trader Joe's, TJ Maxx, PetSmart, Barnes & Noble and Pier 1 Imports.

Faris Lee Investments had listed the Commons with owner CapLease Inc. in mid-2013 and generated multiple offers, none of which were acceptable to the seller. During its review of options for the owner, Fairs Lee identified some of the challenges CapLease was undergoing as an East Coast owner of a West Coast asset and introduced it to ValueRock as a potential joint-venture partner alternative to selling the property. During the negotiations for the new ownership structure, CapLease was acquired by ARC, a full-service real estate advisory firm.

"This joint-venture structure was strategic, uniquely complex and born out of a disciplined review and approach to maximizing the value of the asset, on both financial and operational levels to meet the ownership's goals and objectives," says Richard Chichester, president and CEO of Faris Lee. "To that end, we explored and developed multiple scenarios including sale, recapitalization and partnership and determined that with the right operating partner, the long-term value would be best maximized through a joint venture."

According to Dennis Vaccaro, senior managing director with Faris Lee, "both CapLease and ARC are New York-based companies. We were able to match ARC with ValueRock, an experienced, locally based operator and manager with other proven success operating south Orange County retail properties."

Under the new joint-venture structure, ValueRock will be taking the lead on operations and lease negotiations and will consider future strategies to reposition the asset in order to maximize value through tenancy. "We are pleased to partner with ARC and look forward to working with them to add value to the property through proactive management and leasing," says William Winn, president and CEO at ValueRock. "This property offers an intrinsic value in a key market that has limited potential for future development."

The Commons at Aliso Viejo is part of the Aliso Viejo master-planned community. The city's plan strictly limits commercial development, preventing any future overdevelopment in the area.

As GlobeSt.com reported in September 2013, Chichester told us during the recent ICSC Western Division Conference in San Diego that post-economic crisis mortgage lenders are being extra scrupulous by evaluating both the asset to be financed and the borrower's credentials. In an exclusive video, Chichester also talked about the smartest areas for retail investors to place their money, the ease or difficulty of obtaining a retail loan in today's economic climate and what he sees as the "next big thing" for retail investments.