ALTO Fund III is thrilled to announce our recent purchase of the Cranberry Square Shopping Center for $23.5 million. A 195,165 SF open-air retail power center, Cranberry Square marks ALTO’s third acquisition in the Pittsburgh, PA MSA, in partnership with M&J Wilkow.
Sitting on a 22-acre site, the center is 100% leased by four major retailers, Dick’s Field & Stream (their first location), Best Buy, Toys “R” Us, and Barnes & Noble, as well as well-known national retailers, OfficeMax, Five Below, and Lumber Liquidators. The property is shadow-anchored by Walmart Supercenter and Costco. ALTO may obtain the Toys “R” Us ground lease, which is significantly below market, resulting in the opportunity to re-tenant the space with a stronger credit tenant at a market rent that will further enhance the value of the center.
“Cranberry Square embodies the characteristics of a great real estate investment for our fund,” says Scott G. Onufrey, President & Managing Partner at ALTO Real Estate Funds, “with irreplaceable real estate generating strong cash flow, and potential to add value over time as we recapture those spaces currently paying below market rents.”
Adjacent to several other shopping destinations, Cranberry Square is within Pittsburgh’s fastest growing and most affluent submarket. The center is situated in a dominant retail node with multiple shopping centers operating at close to full occupancy, and with the presence of all major national retailers. The region’s retail vacancy rate is 1.4%, compared to the 2.9% rate seen in the overall Pittsburgh area indicating a particularly strong market.
Pittsburgh has transformed into a hub of high-tech, research, medical, and academic excellence, and is home to 68 colleges and universities, including Carnegie Mellon University and the University of Pittsburgh. Technology companies such as Google, Apple, Facebook, Uber, IBM, and others continue to gravitate towards the area. It is also home to the nation’s fifth-largest bank and nine Fortune 500 companies including U.S. Steel, PNC Financial Services, PPG Industries, H.J. Heinz Co., Wesco International, and Dick’s Sporting Goods. The recent development and diverse economy have helped Pittsburgh become the sixth-best area for US job growth, and that growth is expected to continue over the next number of years.
ALTO Real Estate Funds is pleased to announce that Christine Angino has joined the firm as Vice President of Acquisitions. Based out of ALTO’s headquarters in New York City, she will be responsible for the acquisition of open-air retail shopping centers with great value-add opportunities, as well as developing relationships with new operating partners.
“We are delighted to have Christine join our team” said Scott Onufrey, President & Managing Director. “She has great breadth and depth of experience across property sectors. In particular, her background in retail shopping center acquisitions is an excellent fit for ALTO, as we continue to pursue retail properties located in well-established growth markets, with ample value-add opportunities.”
Angino comes to ALTO with over 15 years of experience in the commercial real estate industry, including acquisitions, dispositions, asset management and valuations, having worked at MetLife Real Estate, and Brixmor Property Group (formerly Centro Property Group and New Plan). “I’m excited to join the team and look forward to continuing the growth ALTO has, thus far, enjoyed”.
Younger consumers who are driving curation trends at shopping centers desire variety and surprise in their dining choices, and that will cause the number of food halls in the U.S. and Canada to nearly triple in just the next few years.
In a report titled “Food Halls of North America,” Cushman & Wakefield projected that there will be 300 or more “major” food halls of 10,000 sq. ft.-50,000 sq. ft. on the continent, compared to just over a hundred at the end of 2017. This rapid growth trend, the report held, has been put in play primarily to suit the appetites of Millennials.
That generation savors inexpensive-but-high-quality dining options and spends 44% of its food dollars eating out, the report noted. Seeking variety, four out of 10 of them order something different every time they visit the same restaurant, making food halls a premier option. More than half of Millennials even prefer communal seating when eating out.
Food halls have an appeal to all age groups in that they can overwhelm the senses, said the report: “They are visually appealing, the aromas are enticing, and the spaces inviting. The vendors are global in nature, offering a wide range of variety and quality cuisines.”
Operating on a structured commercial real estate model requiring less startup capital than is needed for stand-alone restaurants, food halls encourage innovation. And while critics argue that the number of failed restaurants is on the rise, the report claimed that food halls are one of the contributing factors to that trend.
Google paid the second-highest price in history for a Manhattan building — its New York headquarters at 75 Ninth Avenue for $2.4 billion — in part to claim the 165,000-sq.-ft. Chelsea Market food hall on the ground floor, according to Cushman & Wakefield.
Original article can be found here: https://www.chainstoreage.com/real-estate/number-food-halls-triple-2020/
SAVE THE DATE
We’ll be at ICSC RECon in Las Vegas – will you? Come see us in room MRC 204.
If you’d like to set up a meeting with us, please contact Sierra@alto-inv.com. We look forward to seeing you there!