The new program allows Pine Tree "to find a way to capitalize"on all of the different parts of the company, such as acquisitions,development and construction, says Barry Herring, a principal withPine Tree. "We just found that the bulk of the developments that wefind are through other developers where they have a need forequity, a need for manpower or a need for more expertise," Herringsays. With Pine Trees relationships with pension funds and in-houseconstruction company, "it seemed like it was an easy program for usto step in to keep our acquisition program rolling," he says.

Pine Tree decided to develop the program after being approachedby a broker regarding the Shops at Walnut Creek property, Borzaksays. "Generally, the offers came in one of two ways. They wereeither full price offers from institutions that required thedeveloper to stay involved," he says. "On the other side weredevelopers who were offering more of a wholesale price."

The Shops at Walnut Creek, a 192,000-sf shopping center, isanchored by TJ Maxx, OfficeMax, PetSmart, Golf Galaxy and aseparately-owned Super Target. The center was completed in 2006except for the TJ Maxx and Office Max. The shopping center iscurrently between 93% and 94% leased with an average lease rate forthe area of between $30 per sf and $35 per sf net, Borzak says.Pine Tree will probably construct an additional 15,000-sf buildingnext year at the development, he says. The Shops at Walnut Creekwas purchased as part of a joint venture with Newport, CA-basedBuchanan Street Partners. John Pantone represented Buchanan StreetPartners. LaSalle Bank provided permanent financing for theacquisition with the funding arranged by Bruce Ganong, of SanFrancisco.