HOUSTON-Weingarten Realty Investors has teamed with Mercantile Real Estate Advisors Inc. to invest $500 million into acquiring bulk warehouse and distribution properties in select US markets.
The local REIT and the AFL-CIO Building Investment Trust, which is being managed by Baltimore-based Mercantile Real Estate Advisors, will the capital in the next two years. The anticipated leverage is 50%.
To launch the joint venture, Weingarten contributed five properties totaling more than two million sf and valued at $123 million. The properties are located in San Diego, Memphis and Atlanta. Macquarie Capital Partners LLC, headquartered in Chicago, was exclusive financial adviser to Weingarten Realty Investors in regards to the partnership.
"This joint venture will further diversify Weingarten's available capital resources, allow for additional growth in our industrial and retail portfolio, and enhance return on investment," Drew Alexander, Weingarten's president and CEO, says in a press release. Representatives from Weingarten and Mercantile Real Estate Advisors Inc., a wholly owned subsidiary of Mercantile Bancshares Corp., could not be reached for comment by press time.
From a market watcher's viewpoint, Graham Horton, associate director with Cushman & Wakefield of Texas Inc., says the partnership should be strong for both sides. "It'll give Weingarten additional capital to make acquisitions in new or emerging markets and it'll allow MREA to partner up with a well-established real estate company that has resources across the US," he tells GlobeSt.com. "While MREA brings in the ability to source capital, Weingarten brings in the ability to know how to place it."
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