Inland Real Estate Corporation is expanding its presence in metropolitan Cincinnati. In a joint venture with PGGM, a Dutch pension fund advisor, the REIT has acquired the first phase of Newport Pavilion, a 471,800-square-foot grocery-anchored power center in Newport, Ky. The property changed hands for $43.3 million in cash.
Newport Pavilion is located within one mile of downtown Cincinnati. Phase one consists of 222,300 square feet of retail space. According to Inland Real Estate, it was 98% leased at the time of the sale, to retailers such as Kroger Marketplace, PetSmart, Famous Footwear or Chic-fil-A. The center also includes a separately-owned 134,500-square-foot Target store.
According to a recent report from Marcus & Millichap Real Estate Investment Services Inc., transaction volume in metropolitan Cincinnati’s multi-tenant retail sector has increased 50 percent over the past 12 months; the average price per square foot reached $165 at the end of the first quarter. The Inland Real Estate–PGGM joint venture paid about $195 per square foot for Newport Pavilion’s first phase.
The joint venture expects to buy the second phase of the project for about $23.8 million. Phase two includes 115,000 square feet of space that will be occupied by such retailers as Dick’s Sporting Goods, TJ Maxx and Buffalo Wild Wings. The acquisition is expected to close before the end of the year.
“Newport Pavilion is an outstanding addition to our necessity and value-based retail portfolio, representing best-in-class new power center development, with leading national retailers in a high-barrier-to-entry infill location,” said Mark Zalatoris, president & CEO of Inland Real Estate Corporation, in a statement.
“Our acquisition of this ‘Class A’ Kroger-anchored power center in Ohio’s largest metropolitan area enhances the geographic and tenant diversification of our portfolio, and represents an accretive re-deployment of proceeds from recent dispositions of non-core assets.”Photo illustration: Inland Real Estate Corporation Charts courtesy of Marcus & Millichap.