DLC Buys 2.6 MSF Portfolio of 11 Retail Assets

By Keith Loria Contributing Editor

DLC Management Corp. has acquired 11 retail assets, totaling 2.6 million square feet, located throughout New York, North Carolina, Arkansas and Tennessee.

Of the total property, 1.73 million square feet is owned by shadow anchors on which the retail sits.

The purchase represented the largest in the history of the company and the properties’ locations match well with DLC’s operations and represent large, high-quality assets with strong anchor tenants and an opportunity to create value throughout the portfolio.

“This deal will likely be viewed with optimism within the retail sector, as the availability of financing for traditional bricks-and-mortar strip retail has been uneven in recent years,” Andrew Maguire, a senior real estate attorney with McCausland Keen & Buckman, told Commercial Property Executive. “As always, the presence of strong anchor tenants, high occupancy and strong cap rates will be viewed favorably by prospective lenders.”

The properties included in the deal include 2015 Walden Ave., a 26,500-square-foot retail center in Cheektowaga, N.Y.; Batavia Commons, a 49,431-square-foot retail center in Batavia, N.Y.; BJ’s Plaza, a 95,846-square-foot retail center in Batavia, NY; Premier Place, a 414,639-square-foot retail center in Williamsville, N.Y.; River Hills, a 315,234-square-foot retail center in Asheville, N.C.; Spring Creek, a 588,606-square-foot retail center in Fayetteville, Ark.; Steele Crossing, a 261,665-square-foot retail center in Fayetteville, Ark; Towne Centre, a 390,607-square-foot retail center in Murfreesboro, Tenn.; Union Consumer Square, a 386,320-square-foot retail center in  Cheektowaga, N.Y.; Walden Consumer Square, a 253,225-square-foot retail center in Cheektowaga, N.Y.; and Walden Place, a 68,000-square-foot retail center in Cheektowaga, N.Y

“I’m thrilled to announce today that Team DLC closed the largest acquisition in its history, an 11-center, 2,578,000-square-foot, power center portfolio in four states of which 1,732,957 is owned,” Adam Ifshin, DLC Management Corp.’s CEO, said in a company statement. “With significant value added potential in select key assets in the portfolio, we look forward to bringing additional best in class value-oriented tenants to this exciting portfolio.”

The buyer characterized this deal as an “off-market” transaction, which Maguire said may be indicative of an emerging trend where buyers and sellers independently negotiate and structure buy/sell transactions without the involvement of third party brokers.

“Sellers of certain assets (like hotels, apartment buildings and self-storage facilities, for example) will often entertain ‘quiet’ or off-market listings to avoid scaring their existing workforce by publicly marketing the property for sale,” he said. “Once the word is out that those types of assets are on the market, the seller will often find itself in the uncomfortable position of trying to calm their employees without being able to commit to their long-term job security.”

DLC Management Corp. leases a portfolio of 115 open-air shopping centers, totaling more than 19.1 million square feet of retail space in 29 states.