June 29, 2023
Continental Realty Corporation Acquires 17th Retail Asset In Florida With Purchase Of Lakeside Village Near Tampa
BALTIMORE, MD (June 27, 2023) – Continental Realty Corporation (CRC), a Baltimore-based real estate investment and management company with over $3.6 billion of Assets Under Management (AUM), has purchased its 17th retail asset in Florida with the acquisition of Lakeside Village, a nearly 460,000 square foot super-regional lifestyle center located at 1479 Town Center Drive in Lakeland, just east of Tampa. CRC acquired the asset in an off-market transaction, with Danny Finkle and Eric Williams of the Miami office of Jones Lang LaSalle representing the unnamed seller. CRC has now acquired nearly $630 million worth of shopping centers over the past three years.
Lakeside Village was purchased on behalf of Continental Realty Opportunistic Retail Fund I, LP (CRORF), a closed-end fund for which $261 million has been raised since 2021, including $200 million in the Fund and $61 million in three co-investment vehicles. Since the inception of CRORF, CRC has acquired 10 retail properties comprising nearly 2.4 million square feet of space and deployed nearly $150 million of equity. Since 2012, CRC has raised almost $1 billion in equity for retail and multifamily investments across five real estate funds and multiple associated co-investments.
CRC owns and manages a diversified portfolio of more than 9,000 apartment homes, as well as retail centers and other commercial properties consisting of almost 8 million square feet, serving the real estate needs of more than 1,100 tenants across 10 states. CRORF was formed as a vehicle to target and acquire a diversified portfolio of distressed, opportunistic, and value-add retail properties throughout the United States.
Constructed in 2005, Lakeside Village is 91 percent leased, anchored by Belk, Cobb Theatre, Books-A-Million, and shadow-anchored by Kohl’s. The center includes more than 70 tenants offering a diverse mix of uses, including entertainment, medical/healthcare, fitness, food, and beverage as well as 46,000 sf of Class A office space. Best-in-class tenants include Burger 21, Chico’s, Fish City Grill, Ideal Image, Pearle Vision, Saigon Bistro, Starbucks Coffee, Versona and Victoria’s Secret. The open-air shopping center sits on 88 acres with over 2,000 feet of frontage on Polk Highway, which connects to I-4 and the greater metropolitan areas of Orlando and Tampa. The immediate area is growing organically, with more than 900 multifamily units planned for development on a property adjacent to Lakeside Village, joining the existing 312 apartments located behind the center and four hotels on the site. With this acquisition, CRC now owns and manages nearly two million square feet of retail space throughout Florida.
Strategic Investment in Florida’s Employment and Industrial Hub
“Lakeside Village is an institutional quality outdoor lifestyle center strategically located in the heart of the I-4 corridor, a rapidly growing area with highly successful tenants and limited competition,” stated Josh Dinstein, Senior Vice President, Acquisitions for Continental Realty Corporation. “This acquisition is perfectly aligned with our overall strategy to own and operate institutional-quality retail centers in high growth areas with strong value-add potential.
“Based on our long-term relationship with the seller and broker, we were able to execute a completely off-market transaction. By implementing proven property management protocols, we are confident in our team’s ability to build additional value in the asset over the long term.”
CRC plans to embark on a more than $3 million renovation strategy in the immediate future, focusing on replacing the shopping center’s roof, painting the exterior, and revitalizing the commercial office space.
Continued Capital Investment Fueling New Jobs and Median Household Income Growth
More than $100 million worth of capital investment in the City of Lakeland in 2022 fueled the creation of more than 500 new jobs, which resulted in the absorption of approximately one million square feet of commercial office space. Additional employment opportunities are available at the corporate headquarters of Publix Super Markets, which is less than two miles away; Walmart’s nearby two million square foot distribution center; and Amazon’s one million square foot warehouse hub. With more than 11 million people residing within a 100-mile radius and plentiful land opportunities, the Lakeland area also remains attractive for new distribution centers.
Lakeside Village is positioned three miles from Lakeland Linder International Airport, 33 miles from Tampa, and 60 miles from Orlando. More than 5.5 million people visit the local area annually, and the trade area extends more than 15 miles, reaching nearly 500,000 residents with a collective buying power of $9.9 billion.
According to the Lakeland Economic Development Council, the population of unincorporated Lakeland is more than 300,000 people and the average home price is nearly $290,000., with major employers including Publix Super Markets, Lakeland Regional Health, GEICO, Amazon, Watson Clinic, Saddle Creek Logistics Services and Southeastern University.
Businessinsider.com calls Lakeland the “#1 city in the country to buy a home,” Bloomberg.com terms it the “fastest growing city in the U.S.,” US News considers Lakeland the second-fastest growing place in the country, and Inc.com says the area is the “best place to start a business.” Polk County is considered the fourth fastest-growing metropolitan statistical area in the U.S., and in the top 10 ranking nationally in talent attraction, based in part on its location between Tampa and Orlando.
Summary of CRORF acquisition activity
Seven of the ten properties acquired by CRORF are grocery anchored. The Fund is approximately 50% invested and CRC entered the suburban Chicago, Illinois and Troy, Michigan trade areas last year. Key acquisitions included Banks Crossing, a 255,101 square foot regional shopping center in Fayetteville, Georgia; The Shoppes at Webb Gin, a 330,000 square foot lifestyle center in Greater Atlanta; a portfolio of five shopping centers comprising more than 900,000 square feet of space in Cicero, Mount Prospect, Naperville, and Palatine, Illinois; and Oakland Plaza and Oakland Square, shopping centers located in Troy, Michigan consisting of nearly 392,000 square feet of space.
CRORF targets neighborhood, grocery-anchored, lifestyle and power centers situated within the U.S.’s top 50 Metropolitan Statistical Areas (MSA), as well as select secondary markets.
“With brick-and-mortar retail sales reaching historic highs recently, we believe plentiful opportunities remain nationally, and we intend to continue to search for and deploy capital into open-air retail centers that can deliver strong risk-adjusted returns to our investor group,” explained CRC’s CEO JM Schapiro. “Florida and the southeast portion of the country remain extremely attractive, given the continued population and job migration to these areas, and each of our retail, multifamily and mixed-use properties in this region have performed above expectations.
“Some of our most proficient shopping center purchases occurred following the economic downturn in the late 2000s, when investors shied away from the retail asset class. Having invested in shopping centers since 1979, our team anticipates that we can identify additional extraordinary opportunities, using our vertically integrated platform, commitment to cutting-edge data sources, deep understanding of the retail industry and long-term relationships in the market. Our ready capital and nimble team will enable us to take advantage of existing conditions as a preferred counterparty with a strong track record and certainty of close.”
Headquartered in Baltimore, Maryland and founded in 1960, Continental Realty Corporation is a full-service commercial real estate and investment company focused on acquiring and operating retail and multifamily properties. The privately held firm owns and manages a diversified portfolio of retail centers consisting of nearly eight million square feet of commercial space and over 9,000 apartment homes across 10 states, with a portfolio value exceeding $3.6 billion. For additional information, visit www.crcrealty.com.
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