Weingarten, AEW Form $238M Buying Pool

HOUSTON-Let the buying begin. Weingarten Realty Investors has formed a joint venture with Boston-based real estate advisory firm, AEW Capital Management LP to go on a shopping spree to buy $238 million of real estate assets using limited leverage.

Weingarten will serve as the managing member, tasked with closing the deals and then leasing and managing the properties. The JV is looking to buy high-quality, supermarket-anchored shopping centers.

AEW has entered into the venture on behalf on one of its Fortune 50 pension fund clients. Initial cash flow distributions will be dealt out on a non-preferential pro rata basis with neither party receiving a preferred return. Once certain performance hurdles are met, Weingarten will get a bigger return.

“This alliance will further diversify Weingarten’s available capital resources and will allow us to enhance our growth through investing in our core property type, the supermarket-anchored shopping center,” said Drew Alexander, Weingarten president and CEO.

AEW principal Bob Plumb says “AEW has a long history of partnering successfully with strong, experienced real estate operators on behalf of our clients. Weingarten meets all of our criteria.”

The local REIT passed the test on its strategy, management team, product and target markets, the southern half of the US where it has 298-income-producing properties. The current portfolio contains 241 neighborhood and community shopping centers, 56 industrial holdings and one office building.