WHITE PLAINS, N.Y.--(BUSINESS WIRE)--Dec. 21, 2012--
Acadia Realty Trust (NYSE: AKR) today announced continued activity
across its dual – core and fund – platforms, completing $240 million of
acquisitions since mid-November 2012. Additionally, in December 2012,
Acadia sold, or entered into a firm contract to sell, $418 million of
assets within its fund portfolios.
ACQUISITION ACTIVITY
Fund platform:
In December 2012, Acadia, through Acadia Strategic Opportunity Fund IV
LLC (“Fund IV”), completed three new investments for an aggregate
purchase price of $151 million. Most significantly, this included a $139
million portfolio acquisition on Lincoln Road in Miami Beach, Florida.
Acadia launched Fund IV in May 2012 with $541 million of capital
commitments for the purpose of making opportunistic and value-add
investments in retail real estate. With leverage, Fund IV has
approximately $1.5 billion of buying power.
Lincoln Road, Miami Beach, FL. This week, Acadia, in partnership
with Terranova Corporation, acquired a 54,400 square foot,
three-property portfolio located at 719, 801, and 826 Lincoln Road for
$139 million. The portfolio, which is situated at the “Main & Main”
intersection of Lincoln Road and Meridian Avenue, is leased to a
combination of local tenants and national retailers including Fossil,
Aldo, Kiehl’s, and Dylan’s Candy Bar. Leases representing nearly half of
the portfolio’s annual base rent expire within the next 24 to 36 months.
Given that rents on Lincoln Road have increased significantly over the
past few years, the majority of the portfolio’s in-place rental rates
are significantly below market. In addition, there is the ability to
redevelop some of the assets as well as improve the portfolio’s
merchandise mix. Acadia, through Fund III, previously partnered with
Terranova, in February 2011, on the successful acquisition of another
60,700 square foot, three-property portfolio located at 600 and 741
Lincoln Road and 723 N. Lincoln Lane.
“Over the past few years, Lincoln Road has established itself as a
‘must-have’ location for our retailers, with exceptional global branding
opportunities matched by high sales productivity,” stated Kenneth F.
Bernstein, President and CEO of Acadia Realty Trust. “Tenants are
attracted to this prime street-retail market as an essential component
to their various multi-channel retailing initiatives. As such, we are
pleased to continue building a presence along this vibrant international
shopping and dining corridor in partnership with the extremely talented
team at Terranova. Led by Stephen Bittel, Terranova has been
instrumental in executing the leasing and development strategy for our
existing South Beach assets. Most recently, this has included bringing
Armani Jeans and Khong River House, by restaurateur John Kunkel, to 741
Lincoln Road. We look forward to participating in Lincoln Road’s next
chapter with our valued partner.”
Core platform:
Since mid-November 2012, Acadia has continued to add high-quality,
stabilized street-retail assets to its core portfolio with the
acquisition of four investments – in Washington, D.C.; Westport,
Connecticut; and Chicago, Illinois – for an aggregate purchase price of
$89 million.
Connecticut Avenue NW, Washington, D.C. In December 2012, Acadia
acquired a 42,000 square foot, two-property portfolio located at
1739-1803 Connecticut Avenue NW, which is within walking distance of
Dupont Circle. The purchase price was $23 million. Principal retail
tenants include TD Bank and Ruth’s Chris Steak House.
Main Street, Westport, CT. In December 2012, Acadia completed the
previously-announced, $14 million acquisition of 181-185 Main Street in
Westport, one of Fairfield County’s affluent “Gold Coast” towns. The
asset’s principal retail tenant is TD Bank, which serves as the
northernmost anchor of this town’s quarter-mile,
predominantly-fashion-focused Main Street shopping district.
W. Diversey Parkway, Chicago, IL. In December 2012, Acadia
completed the previously-announced, $11 million acquisition of 639 W.
Diversey Parkway, which is located at the corner of W. Diversey Parkway
and N. Clark Street in Lincoln Park, Chicago. The street level of this
22,000 square foot, two-level property is leased to three retail tenants
– Akira, T-Mobile, and Hanig’s Footwear. Through this strategic
acquisition, Acadia now owns two contiguous blocks on the south side of
W. Diversey Parkway spanning N. Clark Street, from Trader Joe’s to
Starbucks and Papyrus. As part of this transaction, Acadia assumed $4
million of debt.
Street Retail Portfolio, Chicago, IL. In November 2012, Acadia
completed the acquisition of the final eight properties in its
previously-announced, 18-property portfolio acquisition within Chicago’s
key street-retail markets. This final group of assets was acquired for
$41 million. The completion of this transaction adds further critical
mass to Acadia’s street-retail portfolio in Chicago, which now includes
the following locations: Rush Street, Clark/Diversey, Halsted/Armitage,
Clybourn Corridor, Bucktown, and the Loop.
DISPOSITION ACTIVITY
During the fourth quarter, Acadia continued to opportunistically
monetize $418 million of fund investments. Year to date, Acadia has
monetized $478 million of stabilized fund assets.
Fund platform:
Storage Post, New York/New Jersey. In December 2012, Acadia
entered into a firm contract to sell its entire portfolio of 14
self-storage assets located in the New York City area for $294 million.
The purchaser is a joint venture between an institutional investor and
the current Storage Post management team led by Bruce Roch, Jr. The
portfolio contains 1.1 million rentable square feet of self-storage
space that was 92.8% occupied as of September 30, 2012. The portfolio
also includes 26,125 square feet of retail space that adjoins the
self-storage facility located in Ozone Park, Queens. This retail space
is anchored by CVS and IHOP and is 100% occupied.
Three of the assets in the portfolio were developed by Acadia Strategic
Opportunity Fund II, LLC (“Fund II”). The balance of the assets were
acquired, and in one location developed, by Acadia Strategic Opportunity
Fund III LLC (“Fund III”). The aggregate investment of both Funds II and
III in these assets amounted to approximately $252 million.
The sale of 12 properties, including all 11 properties owned by Fund
III, was completed yesterday. The sale of the remaining 2 properties is
expected to close during the first quarter of 2013. Following the final
closing, Acadia will have completed the disposition of its entire
self-storage portfolio. The closing of these 2 properties is subject to
customary closing conditions and, as such, no assurance can be given
that Acadia will successfully complete this transaction.
Acadia, through Fund III, will retain its ownership interest in the
Storage Post operating company, which will continue to manage the
properties on behalf of the buyer. Additionally, Acadia, through Fund
III, received a minority interest in the 14-property portfolio
“This profitable sale transaction not only enabled us to achieve best
execution on our investment but also positions Storage Post to become
the premier, private self-storage operating company in the United
States,” stated Mr. Bernstein. “Marc Slayton, the founder of Storage
Post, had the foresight to develop a portfolio of high-quality
self-storage assets in the densely-populated, supply-constrained New
York City area. And the current Storage Post management team, led by the
exceedingly-capable self-storage entrepreneur Bruce Roch, Jr., has done
an excellent job maximizing occupancy, growing NOI, and positioning the
portfolio for strong internal growth going forward.”
Canarsie Plaza, Brooklyn, NY. In December 2012, Acadia, through
Fund II, completed the previously-announced sale of Canarsie Plaza, a
274,000 square foot shopping center located in the densely-populated
borough of Brooklyn. The property was sold for $124 million,
approximately $32 million in excess of its cost basis. Acadia, in
partnership with P/A Associates, acquired this 15-acre development site
in 2007 and successfully navigated the development project through an
anchor re-tenanting, design change, and global recession. At
disposition, the property was 96% leased, with principal tenants
including BJ’s Wholesale Club, Planet Fitness, and PetSmart.
Acadia will incur short-term earnings dilution from the profitable sale
of these Fund assets until the net proceeds are redeployed into new Fund
investments.
ABOUT ACADIA REALTY TRUST
Acadia Realty Trust, a fully-integrated equity real estate investment
trust, is focused on the acquisition, ownership, management and
redevelopment of high-quality retail properties and urban/infill
mixed-use properties with a strong retail component located primarily in
high-barrier-to-entry, densely-populated metropolitan areas along the
East Coast and in Chicago. Acadia owns, or has an ownership interest in,
these properties through its core portfolio and its
opportunistic/value-add investment funds. Additional information may be
found on the Company’s website at www.acadiarealty.com.
FORWARD-LOOKING STATEMENTS
Certain matters in this press release may constitute forward-looking
statements within the meaning of federal securities law and as such may
involve known and unknown risks, uncertainties and other factors that
may cause the actual results, performances or achievements of Acadia to
be materially different from any future results, performances or
achievements expressed or implied by such forward-looking statements.
These forward-looking statements include statements regarding Acadia’s
future financial results and its ability to capitalize on potential
opportunities arising from continued economic uncertainty. Factors that
could cause the Company’s forward-looking statements to differ from its
future results include, but are not limited to, those discussed under
the headings “Risk Factors” and “Management’s Discussion and Analysis of
Financial Condition and Results of Operations” in the Company’s most
recent annual report on Form 10-K filed with the SEC on February 28,
2012 (“Form 10-K”) and other periodic reports filed with the SEC,
including risks related to: (i) the current global financial environment
and its effect on retail tenants; (ii) the Company’s reliance on
revenues derived from major tenants; (iii) the Company’s limited control
over joint venture investments; (iv) the Company’s partnership
structure; (v) real estate and the geographic concentration of our
properties; (vi) market interest rates; (vii) leverage; (viii) liability
for environmental matters; (ix) the Company’s growth strategy; (x) the
Company’s status as a REIT; (xi) uninsured losses and (xii) the loss of
key executives. Copies of the Form 10-K and the other periodic reports
Acadia files with the SEC are available on the Company’s website at www.acadiarealty.com.
Any forward-looking statements in this press release speak only as of
the date hereof. Acadia expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any
forward-looking statements contained herein to reflect any change in
Acadia's expectations with regard thereto or change in events,
conditions or circumstances on which any such statement is based.
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Source: Acadia Realty Trust
Acadia Realty Trust
Jon Grisham, 914-288-8100