AmREIT Snares 79,401-SF Lantern Lane Center

HOUSTON-Citing high-quality tenants and potential redevelopment opportunities, an AmREIT affiliate has acquired the 79,401-sf, 100% leased Lantern Lane Shopping Center from a local company. Similar shopping centers in the area have traded for $140 per sf to $175 per sf.

The 20-year-old shopping center, situated on 6.5 acres at 12500 Memorial Dr., is assessed at $10.24 million by Harris County. Differential Development 1994 Ltd. of Houston is listed as the developer. AmREIT executives were unavailable to comment on the transaction before deadline.

Lantern Lane is anchored by a Rice Epicurean Market. Other tenants include Fidelity Investments Corp. and Encore Bank branches and the rest are service-oriented local and regional tenants. "This corner sits in a well seasoned densely populated neighborhood," Kerr Taylor, AmREIT's chairman and CEO, says in a press release about the acquisition. "The location's fundamentals and quality rental income make this a great opportunity for our asset advisory business."

A local market expert agrees the location most likely played a huge part in AmREIT's acquisition. "They have a really sweet spot there on Memorial Drive," says Shawn Ackerman, senior vice president with Henry S. Miller Commercial's retail division in Houston. "There aren't a lot of grocery centers around there so that center captures the whole market."

Ackerman tells GlobeSt.com that the center, renovated in the past five years, was possibly acquired at a low cap rate--in the 7% range. "It's irreplaceable real estate, which is what AmREIT buys," he adds.

The center is located in a strong high-income residential area with high barriers to entry and little land available for development. "Everything is right up to the street," Ackerman says. "There are no hard corners. No lights. No other retail for a long time as you head east."