Cohen & Steers and DLC Management Acquire Open-Air Shopping Center Complex in Fayetteville, Arkansas

Rhea-AI Summary

Cohen & Steers (NYSE: CNS) and DLC Management have acquired a two-property open-air shopping center complex in Fayetteville, Arkansas, comprising Spring Creek Centre and Steele Crossing. The properties cover 403,000 sq ft and feature major tenants like TJ Maxx, Ulta, Best Buy, and Kohl's, achieving a 95% occupancy rate. Tenant-owned anchors include Walmart, Home Depot, and Target. The region is experiencing rapid growth, with the population expanding at 4.5 times the U.S. average. The Milken Institute ranked Fayetteville as the 7th Best Performing City in the U.S. in 2024. The centers are strategically located near three major highways, enhancing traffic and accessibility.

Positive

• Acquisition of 403,000 sq ft retail space with 95% occupancy rate.
• Presence of high-traffic tenant-owned anchors like Walmart, Home Depot, and Target.
• Strategic location near three major highways boosting traffic.
• Fayetteville recognized as 7th Best Performing City in U.S. by Milken Institute in 2024.
• Region's population growth at 4.5 times the U.S. average fosters economic growth.
• Open-air shopping centers at highest occupancy level (95.7%) in 16 years, indicating strong sector fundamentals.
• DLC Management's extensive experience with over 70 shopping centers nationwide.

Negative

• new supply in open-air shopping centers sector may restrict growth opportunities.
• High dependency on current economic trends and migration patterns.

Insights

Real Estate Analyst

The acquisition of the open-air shopping center complex in Fayetteville, Arkansas, by Cohen & Steers and DLC Management is strategically significant. Open-air shopping centers are currently experiencing high occupancy levels, with a national average of 95.7%, reflecting strong tenant demand and limited new supply. The centers' 95% occupancy rate is in line with these robust fundamentals. Tenants such as Walmart, Home Depot and Target act as anchor stores driving significant foot traffic, enhancing the centers' attractiveness to smaller retailers.

Moreover, Northwest Arkansas' rapid population growth—4.5 times the U.S. average over the last five years—suggests a favorable market for retail investment. As the fastest-growing metro area in Arkansas, Fayetteville benefits from economic and employment growth, making it an appealing location for retail development. This population boom, driven by affordable living costs and the presence of major corporations like those listed is likely to continue bolstering retail demand.

Financial Analyst

The acquisition is likely to be financially beneficial for Cohen & Steers and DLC Management. Retail spaces in high-growth areas like Northwest Arkansas can offer stable rental income and potential appreciation in property values. Given the centers' high occupancy rate and anchor tenants, this acquisition should provide consistent cash flows. Moreover, Fayetteville's ranking as the 7th Best Performing City in the U.S. underscores its strong economic potential, which could translate into enhanced retail activity and higher rental yields.

The partnership between Cohen & Steers and DLC Management leverages their combined expertise in real estate investment and management. DLC's experience with the properties and the regional market should facilitate effective asset management, maximizing returns. For retail investors, this reflects prudent portfolio diversification into a high-performing asset class with significant growth prospects.

NEW YORK, June 3, 2024 /PRNewswire/ -- Cohen & Steers, Inc. (NYSE: CNS) announced today that an affiliate of Cohen & Steers Capital Management, Inc. ("Cohen & Steers") and DLC Management ("DLC"), an owner and operator of open-air shopping centers in the U.S., have jointly acquired a two-property open-air shopping center complex in Fayetteville, Arkansas.

The acquisition is comprised of two centers, Spring Creek Centre and Steele Crossing, and encompasses 403,000 square feet of owned retail space. The centers are 95% occupied by tenants including: TJ Maxx, Ulta, Best Buy, Old Navy, PetSmart and Kohl's. The presence of tenant-owned anchors Walmart, Home Depot and Target, as well as the proximity to three major highways in the region, help drive significant traffic to the centers.

The shopping centers also benefit from the growth of the Northwest Arkansas corridor, which is the fastest growing metro area in Arkansas. Over the last five years, the region's population has grown at 4.5 times the U.S. average, according to CoStar Group, as its appeal as a regional business and transportation hub and its lower cost of living foster further economic growth. The Milken Institute named Fayetteville the 7^th Best Performing City in the U.S. in its "Best Performing Cities 2024" report based on the region's economic and employment growth as well as its access to economic opportunities.

James S. Corl, Head of the Private Real Estate Group at Cohen & Steers, said:
"Northwest Arkansas has displayed strong growth in recent years and is home to three Fortune 500 Companies and the University of Arkansas. Similar to many Sunbelt cities, Fayetteville is benefiting from national migration trends as people move to more affordable and economically attractive residential areas across the country. We believe the shopping centers are well-positioned in a dominant location to benefit from these tailwinds and we are excited to partner with DLC."

DLC has over three decades of extensive expertise in shopping centers with a focus on open-air centers. The company has a national footprint of more than 70 shopping centers and has managed Spring Creek Centre and Steele Crossing for over a decade, bringing deep knowledge of the centers and the surrounding market.

Open-air shopping centers are at their highest occupancy level of the past 16 years at 95.7% nationally, according to CoStar Group. As such, the sector is displaying strong fundamentals characterized by robust demand and limited new supply.

About Cohen & Steers. Cohen & Steers is a leading global investment manager specializing in real assets and alternative income, including listed and private real estate, preferred securities, infrastructure, resource equities, commodities, as well as multi-strategy solutions. Founded in 1986, the firm is headquartered in New York City, with offices in London, Dublin, Hong Kong, Tokyo and Singapore.

About DLC. DLC is one of the nation's preeminent private retail real estate companies, with expertise in acquisitions, development, architecture, leasing, and management. Headquartered in Metro New York, DLC has regional operations in Atlanta, Buffalo, Chicago, Dallas, and Washington, DC. For additional information about DLC and its portfolio, please visit www.dlcmgmt.com.

Website: https://www.cohenandsteers.com
Symbol: NYSE: CNS

View original content:https://www.prnewswire.com/news-releases/cohen--steers-and-dlc-management-acquire-open-air-shopping-center-complex-in-fayetteville-arkansas-302161172.html

SOURCE Cohen & Steers, Inc.

FAQ

What properties did Cohen & Steers and DLC Management acquire in Fayetteville, Arkansas?

They acquired the Spring Creek Centre and Steele Crossing open-air shopping centers.

What is the occupancy rate of the newly acquired shopping centers by Cohen & Steers (CNS)?

The shopping centers have a 95% occupancy rate.

Which major tenants are present in the acquired shopping centers by Cohen & Steers (CNS) and DLC Management?

Major tenants include TJ Maxx, Ulta, Best Buy, Old Navy, PetSmart, and Kohl's.

How large is the retail space in the shopping centers acquired by Cohen & Steers (CNS)?

The retail space covers 403,000 square feet.

What factors contribute to the high traffic in the newly acquired shopping centers by Cohen & Steers (CNS)?

Factors include major tenant-owned anchors like Walmart, Home Depot, and Target, as well as proximity to three major highways.

Why is the Northwest Arkansas corridor significant for Cohen & Steers (CNS) acquisition?

The corridor is the fastest-growing metro area in Arkansas, with population growth at 4.5 times the U.S. average and high economic appeal.

What ranking did Fayetteville achieve in the Milken Institute's Best Performing Cities 2024 report?

Fayetteville was ranked as the 7th Best Performing City in the U.S. in 2024.