Single-tenant grocery portfolio sells for $295M
On April 22, 2021, JLL Capital Markets successfully closed the sale of an $295 million portfolio of 11 retail buildings net leased to Stop & Shop across Connecticut, Massachusetts, and Rhode Island. The deal included $157.95 million in acquisition financing. The properties, each with long-term leases, are positioned in densely populated markets and are characterized as pandemic- and recession-resistant. The Inland Real Estate Group acquired the assets, cementing the appeal of grocery-anchored retail properties as a preferred investment class amidst the recovery phase.
- Closed $295 million sale of 11 net leased retail properties.
- Acquisition financing of $157.95 million secured.
- Portfolio includes long-term leases making it attractive for investors.
- Grocery-anchored retail is a preferred asset class, showing strong demand.
- None.
BOSTON, April 22, 2021 /PRNewswire/ -- JLL Capital Markets announced today that it has closed the
JLL marketed the portfolio on behalf of the seller, Winstanley Enterprises and Surrey Equities. The Inland Real Estate Group of Companies, Inc. acquired the assets. Additionally, working on behalf of the new owner, JLL secured two separate 10-year, fixed-rate loans with a life company and with a CMBS lender.
The pandemic-, internet- and recession-resistant retail properties are net leased to Stop & Shop, a division of Ahold Delhaize USA, Inc., the third-largest supermarket operator in the U.S. Additionally, Stop & Shop is the No. 1 grocer by market share in Connecticut, Massachusetts and Rhode Island.
The 748,141-square-foot portfolio of irreplaceable, essential retail properties includes:
- 19 Howley St., Peabody, Mass. (Boston MSA)
- 905 Massachusetts Ave., Arlington, Mass. (Boston MSA)
- 35 Bedford St, Lexington, Mass. (Boston MSA)
- 55 Long Pond Dr., South Yarmouth, Mass. (Cape Cod area)
- 469 Pleasant St., Attleboro, Mass. (Providence MSA)
- 595 Smithfield Rd., North Smithfield, R.I. (Providence MSA)
- 446 Putnam Turnpike, Greenville, R.I. (Providence MSA)
- 333 W. River St., Providence, R.I.
- 1391 Main St., Willimantic, Conn. (Hartford MSA)
- 195 West St., Cromwell, Conn. (Hartford MSA)
- 15 Franklin St., Seymour, Conn. (Hartford MSA)
According to JLL Research's recently released U.S. Grocery Tracker 2021 report, grocery-anchored retail centers continue to be investors' preferred retail property type. Single-tenant grocery assets, like the ones represented in this portfolio, along with grocery-anchored retail under 100,000 square feet, will be one of the most sought-after asset classes during the recovery. JLL anticipates there will be significant cap rate compression over the next 12 to 18 months.
Matthew Tice, senior vice president of Inland Real Estate Acquisitions, LLC, facilitated the acquisition on behalf of The Inland Real Estate Group of Companies, Inc.
"This portfolio's established and necessity-based footprint, combined with 20-year leases at all 11 properties in strong market locations, is an ideal example of the opportunities we seek to acquire as we move further into 2021," Tice said.
The JLL Capital Markets Investment Sales Advisory team representing the seller was led by Managing Director Nat Heald and Senior Managing Director Jose Cruz along with Senior Managing Director Chris Angelone and with support from Managing Director Matthew Sherry.
"The demand and ultimate pricing we saw for this portfolio represents a new pricing paradigm within the single-tenant net-lease space," Heald said. "Since the value of these types of assets appreciated throughout the pandemic, we anticipate investors will continue to aggressively pursue these defensive positions within the retail sector and that demand will far outstrip supply for the foreseeable future."
The JLL Capital Markets Debt Placement team representing the new owner included Senior Managing Directors Lauren O'Neil and Elliott Throne.
"Entering 2021, lenders were hungry to put out capital, particularly in lower-risk assets, like credit, long-term, net-leased retail," O'Neil added. "The two lenders offered the best combination of economic terms and ability to close on a tight timeline. The strength of the Inland acquisition team and process, coupled with the real estate, garnered some of the most attractive terms available."
JLL Capital Markets is a full-service global provider of capital solutions for real estate investors and occupiers. The firm's in-depth local market and global investor knowledge delivers the best-in-class solutions for clients — whether investment sales advisory, debt placement, equity placement or a recapitalization. The firm has more than 3,700 Capital Markets specialists worldwide with offices in nearly 50 countries.
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About Winstanley Enterprises, LLC
Winstanley Enterprises LLC is a vertically integrated commercial real estate investment firm based in Concord, Massachusetts. Founded in 1990, the company has acquired and developed properties across a wide range of asset classes including retail, logistics, life sciences, industrial, office, multifamily residential, research and development and medical office. Throughout its history, Winstanley has earned a reputation for working creatively with businesses and municipalities and following through on its commitments.
About Surrey Equities, LLC
Formed in 2004 by Edward Silvera and Leon Silvera, Surrey Equities, LLC is a real estate investment and management firm specializing in acquiring value-added retail investment opportunities throughout the eastern United States and implementing a tailored strategy to maximize asset value. Its in-depth analysis and due diligence, as well as the character of its leasing and management teams, give Surrey Equities the ability to execute on its plans despite their complexity. The company currently owns real estate in Florida, Massachusetts, New York and Connecticut. For more information, visit surreyequities.com.
About The Inland Real Estate Group of Companies, Inc.
The Inland Real Estate Group of Companies, Inc., headquartered in Oak Brook, Illinois, is one of the nation's largest commercial real estate and finance groups. The Inland Real Estate Group of Companies, Inc. is comprised of independent legal entities, some of which may be affiliates, share some common ownership or have been sponsored and managed by such entities or subsidiaries thereof. Inland has been creating, developing and supporting real estate-related companies for more than 50 years.
About JLL
JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of
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