South Florida Business Journal: Developer snaps up shopping centers for $55M

  • December 16, 2016

Talk about squeezing in some shopping before the holidays. IMC Equity Group has signed the dotted line to purchase two shopping centers in Palm Beach County for a total of $54.7 million.

Carlos Segrera, director of acquisitions and finance for the North Miami-based developer and real estate investment group, said both deals are expected to close within a week.

IMC agreed to purchased Lantana Square, located at 6169 Jog Road. for $31 million and the Commons at Royal Palm, located at 501, 561 and 573 N. State Road 7 in Royal Palm Beach for $23.7 million.

Cushman & Wakefield’s Mark Gilbert and Adam Feinstein brokered the sale of Lantana Square and CBRE’s Casey Rosen and Dennis Carson brokered the sale of the Commons at Royal Palm.

Lantana Square is a 105,550 square-foot shopping center anchored by a Walmart Neighborhood and Walgreens with tenants like Petco, Sears Home Appliance, Lab Corp, T-Mobile, Chipotle, Dunkin Donuts and more. The deal is being financing with a $22 million loan from BB&T, Segrera said. With a $31 million price tag, that amounts to a sale price of $294 per square foot.

Lantana Square is currently 100 percent rented. Lantana Palm Beach Retail LLC, an affiliate of Principal Real Estate Investors, is the seller. Lantana Square was built on the 10.6-acre site in 1986 and last traded for $21.3 million in 2006.

The Commons is a 158,267 square foot retail center anchored by a Hobby Lobby, Big Lots, Party City, Petsmart, Dollar Tree, Starbucks and more. That deal will also be financed by BB&T, this time with a $17.2 million loan. With a $23.7 million price tag, that accounts to a sale price of $150 per square foot.

The Commons is currently 95 percent occupied. RPAI Royal Palm Beach Commons, an affiliate of Retail Properties of America (NYSE: RPAI), is the seller. The Commons at Royal Palm was developed in 2001 and last traded for $24.7 million in 2005.

These two transactions bring IMC’s deal bill up to about $150 million in purchase properties for 2016 for approximately 1 million square feet.

With the Federal Reserve’s recent interest rate hike, and the presidential election, IMC is looking closely at the deal environment moving forward.

“We are paying close attention to interest rates; after the presidential election, long term rates started to rapidly climb coupled with yesterday’s increase in the fed funds rate; with this trend cap rates will start to rise as well, which will put downward pressure on prices,” Segrera said.