LOS ANGELES – November 22, 2016 – CBRE Global Investment Partners (GIP) has acquired a 45 percent interest in a $1.5 billion portfolio of 55 retail assets totaling almost 7 million square feet across 12 U.S. West Coast markets. The investment was made on behalf of GIP’s flagship Global Alpha Fund and various separate account clients. Merlone Geier Partners (MGP) will remain the majority owner and operating partner.
The portfolio, which was assembled by MGP across five of its discretionary commingled funds, includes neighborhood, community and power centers with a strong tenant base. Key anchor tenants are primarily grocery and other necessity-anchored retailers which have historically exhibited strong performance across market cycles and are expected be more insulated from competition by e-commerce. The portfolio provides an attractive core-plus risk profile with a mix of in-place long-term income and short-term value creation opportunities through repositioning and lease-up.
The properties are primarily in neighborhoods around major U.S. West Coast metropolitan areas that offer strong demographics to support a strengthening retail sector, with concentrations in Southern California, Seattle and Sacramento. Other markets include the San Francisco Bay Area and Portland. Retailers are particularly attracted to this region to capitalize on GDP and employment growth as well as rising consumer confidence driven by growth in the technology sector, and these markets have high barriers to entry with physical and regulatory requirements that make it difficult to develop new retail space.
“This joint venture gives us a rare opportunity to access for our clients a large diversified portfolio of high-quality retail centers that would be challenging to acquire in scale,” said Ian Gleeson, CIO for CBRE Global Investment Partners. “We are pleased to partner with Merlone Geier because they are a leading operator that has significant experience in the retail sector.”
Eastdil Secured advised MGP on this transaction.
About CBRE Global Investment Partners
CBRE Global Investment Partners is the division of CBRE Global Investors that delivers investment solutions customized for clients’ individual objectives by constructing portfolios using private funds, secondaries, co-investments and joint ventures, partnering with leading operators and fund managers for each strategy. Investments cover the risk spectrum from core to enhanced, can be global or regional in nature, and use a variety of investment vehicles based on clients' preferences. GIP has $15.2 billion in assets under management* as of September 30, 2016. CBRE Global Investment Partners’ AUM includes investments in programs managed by the direct side of CBRE Global Investors. CBRE Global Investment Partners Limited is authorized and regulated in the United Kingdom by the Financial Conduct Authority (FCA).
About CBRE Global Investors
CBRE Global Investors is a global real estate investment management firm with $87.9 billion in assets under management* as of September 30, 2016. The firm sponsors investment programs across the risk/return spectrum for investors worldwide.
CBRE Global Investors is an independently operated affiliate of CBRE Group, Inc. (NYSE:CBG). It harnesses the research, investment sourcing and other resources of the world’s premier, full-service commercial real estate services and investment firm for the benefit of its investors. CBRE Group, Inc. has more than 70,000 employees in more than 400 offices (excluding affiliates) worldwide. For more information about CBRE Global Investors, please visit www.cbreglobalinvestors.com.
*Assets under management (AUM) refers to the fair market value of real estate-related assets with respect to which CBRE Global Investors provides, on a global basis, oversight, investment management services and other advice, and which generally consist of investments in real estate; equity in funds and joint ventures; securities portfolios; operating companies and real estate-related loans. This AUM is intended principally to reflect the extent of CBRE Global Investors' presence in the global real estate market, and its calculation of AUM may differ from the calculations of other asset managers.
About Merlone Geier Partners
Merlone Geier Partners is a private real estate investment company focused on the acquisition, development and redevelopment of retail and retail-driven mixed-use properties on the West Coast. The firm targets opportunities to add value through lease-up, repositioning, redevelopment or improved management. The in-house staff of development, leasing, asset management and property management professionals executes business plans with respect to each asset. Primarily focused on community and neighborhood shopping centers, Merlone Geier Partners and its predecessor, M&H Realty Partners, have been actively investing in West Coast retail property since 1993, acquiring to date 141 West Coast properties representing over 23 million square feet. The firm, co-managed by Peter J. Merlone and Bradley A. Geier, has raised more than $3.2 billion of discretionary institutional equity capital over the past 23 years.