By Jon Peterson
Rye, New York-based Acadia Realty Trust has paid $46.6 million to close on two retail transactions in urban San Francisco. The larger of the two deals was the $38 million acquisition of the 12,400 square foot (which comes to over $3,064 per square foot) retail asset located at 146 Geary Street within the Union Square submarket. The other investment was an $8.6 million purchase of the Fillmore-Union Collection situated at 2207-2211 Fillmore and 1861-1863 Union Street.
“San Francisco is certainly counted among our retailers’ ‘must-have’ locations, delivering exceptional global branding opportunities and, as importantly, high sales productivity. Consistent with several of our recent fund acquisitions, we believe that these investments will not only deliver attractive risk-adjusted returns, buy also have potential for outsized outperformance, driven by, among other things, a constrained real estate supply and continued growth in tenant demand,” says Joel Braun, executive vice president and chief investment officer of Acadia, in a statement.
146 Geary was bought in a partnership with San Francisco-based City Center Realty Partners. This operating partner did not respond to phone calls seeking comment for this story. The asset is a four-story building with frontage on both Geary Street and Maiden Lane. The current tenants in the property are Chanel, Jimmy Choo, Saint Laurent, Bottega Veneta and Valentino. During 2017, Acadia and City Center plan to redevelop the property.
The Fillmore-Union Collection involved three retail assets. Some of the tenants in these properties are Eileen Fisher, the La Mediterranee restaurant and L’Occitane. This acquisition was done in conjunction with local operating partner, San Francisco-based The Prado Group. This company did not respond to phone calls for this story.
“We are pleased to continue building a presence in San Francisco’s key street-retail corridors, acquiring both flagship locations and fashionable boutique space in partnership with the talented teams at CCRP and Prado,” said Braun in a prepared statement.
Acadia is an equity real estate investment trust that buys retail properties around the country. The company uses its own capital and buys through commingled operating platforms. The kind of retail it buys includes assets in urban and street retail corridors.