By Jon Peterson
Houston-based Weingarten Realty Investors has paid $49 million or roughly $288 per square foot to acquire the 170,427 square foot Cambrian Park Plaza shopping center located at the southeast corner of Camdent and Union Avenues in San Jose, according to sources familiar with the property. The buyer declined to comment on the purchase price when contacted for this story.
“The property as it stands now has very strong demographics and makes it an attractive property to own going forward,” says Tim Frakes, vice president/senior regional director for Weingarten. He works out of the company’s regional office in Phoenix.
The shopping center demographics are having a population of 180,000 people living within a three mile radius of the property, average household income of $117,000 and over 50 percent of the residents own a college degree.
The property is a very likely candidate for a redevelopment opportunity, which the new owner is thinking about for the future. “We do not have finalized plans in place at this time, but the strong demographics and the structure of existing leases provides us the opportunity to redevelop the property over the next several years. The in-fill nature of this location will allow our best-in-class team to create a unique shopping center experience for the local community. We do not have a time frame for a completion of the redevelopment at this time,” said Frakes.
He has a couple of ideas in mind as for the type of retail that might be included in the redevelopment for the future. “The new tenants brought into the property down the road could possibly include a grocery-anchor or junior boxes,” said Frakes.
Weingarten acquired the property in San Jose for its own account. The property was bought from Schaffer Land Trust. The broker on the sale of the property was San Francisco-based Roessler Investment Group. This firm was not allowed to talk about the sale when contacted for the story.
The shopping center has a current occupancy of 97.2 percent, and it is considered a community shopping center. The main tenants in the property now are a Dollar Tree store, a bowling alley and Bank of America. The current leases in the property will expire or can be terminated within the next three years. The asset sits on 17.23 acres of land.
Weingarten owns a significant portfolio in Northern California. The publicly-traded real estate investment trust now owns 15 shopping centers in the region totaling two million square feet. The company likes the region and will continue to look for opportunities here. “Northern California is an excellent market with very strong demographics and high barriers to entry for new development,” said Frakes. Most of the properties it typically invests in vary from 100,000 to 500,000 square feet.
Weingarten figures to have a very active year buying and selling properties on a nationwide basis. The REIT stated in its 2015 guidance report that the portfolio activity for the year will be $200 million to $250 million in acquisitions, $50 million to $100 million in new development and $125 million to $175 million in dispositions.