Whitestone Buys 2 Fulton Ranch Retail Centers in $48M Deal
- Nov 08, 2014
Houston-based Whitestone REIT has expanded its footprint in Phoenix through the $47.9 million acquisition of Fulton Ranch Towne Center and The Promenade at Fulton Ranch. The assets are part of the Fulton Ranch, a 520-acre, master-planned community in Chandler.
The average household income in the Fulton Ranch community is $106,079, significantly higher than in metropolitan Phoenix metropolitan area, which averages $71,229, the company said in a statement.
Located at the southeast corner of South Arizona Avenue and West Ocotillo Road, Fulton Ranch Towne Center was acquired for $29.3 million and offers 113,381 square feet of space. The acquisition also included two pad sites that accommodate an additional 18,000 square feet of retail space, and the option to purchase a 30,187-square-foot building that is expected to be vacant soon.
The Promenade at Fulton Ranch is located at the intersection of South Alma Road and West Chandler Heights Road. The 98,792-square-foot center traded for $18.6 million was 76 percent occupied at closing.
“Both Fulton Ranch Towne Center and The Promenade at Fulton Ranch were ‘off market’ acquisitions located in the technology hub corridor within the Chandler, Gilbert and Mesa, Arizona area. Both properties enhance our presence in the growing southeast valley of the Phoenix MSA, and expand our opportunities for economies of scale and leasing synergies with Whitestone’s existing infrastructure. The properties feature balanced and complementary tenant businesses which meet the needs of the residents from the surrounding communities,” said James C. Mastandrea, Whitestone’s Chairman and CEO.
Whitestone acquired the assets with financing from a 2.66 percent corporate credit facility. Annual net operating income for the two retail centers was estimated at $3.6 million, or 7.5 percent of the purchase price. Considering that both properties have value-add capabilities and are incremental to funds from operations per share, they are expected to contribute $0.02 per share in 2014 and $0.10 per share in 2015. according to the company.