WASHINGTON, DC-Ownership of an upscale shopping center known as Mazza Gallerie has changed hands in a recent transaction. General Electric Real Estate sold the 300,000-sf retail destination to pension fund TIAA-CREF. General Electric Real Estate became the owner of the property through its 2002 takeover of Security Capital of Santa Fe, NM, which purchased Mazza Gallerie with McCaffrey Interests for $28 million in 1997. The financial terms of the deal have not been revealed; however, Washington, DC records list the property’s assessed value for 2005 at about $62.5 million. Reports from last summer, before the property hit the market, estimated that the shopping center could command as much as $70 million.

Mazza Gallerie occupies a nearly two-acre parcel on a popular retail strip on Wisconsin Avenue in Friendship Heights, a neighborhood just outside of Chevy Chase, MD. Built in 1977, the property underwent a massive renovation in 1999 that left the previously three-level site with an additional floor, and added a seven-screen movie theater. The roster of about 25 tenants includes such high-end retailers as Neiman Marcus and Saks Fifth Avenue Men’s Store, as well as Ann Taylor, Mimi Maternity, Williams-Sonoma and the less upscale, but nonetheless popular Filene’s Basement.

Given the current state of the retail market in Washington, DC–the city ranks number two behind Orange County, CA on Marcus & Millichap’s National Retail Index–the transaction marked a win-win deal for seller and buyer alike. “The sale is part of our ongoing review of our portfolio, and this was just the right time to sell the property,” Dan Whitney, GE vice president of Global Communications, tells GlobeSt.com. TIAA-CREF could not be reached for comment by deadline, but numbers indicate that more such high-figure investments are on the horizon.

“The flow of capital into retail real estate in Washington should continue for several years due to limited opportunities for new development and a vital and busy market,” Marcus & Millichap notes in its February 2004 Retail Research Report. “Investors will continue to seek retail investments, and demand for product will push prices higher in 2004.”

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