Cencor-GE JV Acquires 183,983-SF Addison Town Center

ADDISON, TX-The Jacksonville, FL-based Regency Centers Corp. has hawked the 183,983-sf Addison Town Center to a joint venture of Cencor Realty Services and GE Real Estate in a back-to-back double sale of a key retail property in Dallas/Fort Worth. The REIT has flipped the 30-acre hard corner in North Dallas for more than $18 million after a 19-month hold.

Regency Centers had Addison Town Center on the market along with the 198,443-sf MacArthur Park Shopping Center in Irving, but decided to split the package to realize more gain from an asset class drawing top dollar in most scenarios, Herbert D. Weitzman, chairman and CEO of the Dallas-based Cencor and affiliate, the Weitzman Group, tells GlobeSt.com. He says the REIT is drumming up capital for its stake in last year's 2.7-million-sf portfolio acquisition from the Atlanta-based Branch Properties Inc. Last week, the Houston-headquartered AmREIT paid $38 million to Regency for MacArthur Park. For that story, click here.

Weitzman says the competition was stiff for the 87%-leased Addison Town Center, a 12-year-old development with a class A-plus location at the crossroads of Marsh Lane and Belt Line Road at the city's western gateway. "We were the high bidder on this one," he confides. With the Dallas Central Appraisal District closely watching year-end sales, all he'll say about the price is that it was "more than $18 million."

Regency remodeled the center at 3716 Belt Line Rd. after spending nearly $19 million on the May 2003 purchase from Commons at Cliff Creek Ltd., a German investment group, in a pass-through from the Weitzman Group. Regency then set about finishing the redevelopment of a high-profile property rebounding from three anchor losses. But, the job's not quite done. Weitzman says additional improvements will add character and color "to create more of a sense of place" in a cornerstone center at power intersection while talks continue with the city over the redevelopment plan, which includes an access from Marsh Lane. The cost is still being calculated, but Weitzman says the extra upgrades conceivably could exceed $1 million.

Under Regency's reign, the center added PetsMart and Office Depot as backfill for a dark 40,000-sf CompUSA box. The Cincinnati-based Kroger Co. opened a Signature store in 50,000 sf just as Regency took control while the third anchor space, a 123,000-sf Kmart, was bought by the Minneapolis-based Target Corp., which opened doors about five months after Regency moved in. "The whole complexion of the center changed," Weitzman explains, adding some vacant shop space might be combined to create room for another anchor.

The existing tenant roster is made up of leases averaging about 15 years, Weitzman says. The retail line-up includes Babies "R" Us, Blockbuster and Dollar Tree. Cencor will manage the center and Weitzman Group's leasing director Tony Albanese will lease it. Inline space goes for $20 per sf.

The deal sets up the first Dallas/Fort Worth acquisition for the JV, which now holds 12 deeds after jumpstarting its plan last fall with an eight-center portfolio in the Austin area. Stephen J. Hefner, Cencor's vice president of acquisitions, and Randy Woodruff, Cencor's CFO, handled negotiations for the buyer. Jack Crews with Dallas-based Trammell Crow Co. steered the sale for Regency.