EDITOR’S NOTE: This story has been updated with comments from Advantage Commercial Real Estate.
GRAND RAPIDS — The owners of the Shops at CenterPoint mall in Grand Rapids have sold the property in a $63.5 million transaction.
New York City-based Stonemar Properties LLC, a real estate investment and property management firm, closed on the off-market transaction for the mall with a fund managed by New York-based DRA Advisors LLC in partnership with Illinois-based Pine Tree Commercial Realty LLC.
The CenterPoint deal marks Pine Tree’s entry to the Grand Rapids market and comes as the firm has gone on a buying spree in the last year, deploying some $375 million in transactions, according to a statement.
“We’re extremely proud to be a part of the future of this strong regional center in a fantastic and growing market, and we look forward to leveraging our team’s extensive retail expertise to strengthen what is one the area’s most important retail assets while connecting with and serving the Grand Rapids community,” said Conor Bossy, EVP, director of acquisitions at Pine Tree in a statement.
The 537,948-square-foot shopping center, located near the busy, retail-heavy intersection of 28th Street and the East Beltline Avenue, includes retailers T.J. Maxx, HomeGoods, Nordstrom Rack, Sierra Trading Post, DSW Designer Shoe Warehouse, Ulta Beauty, Five Below, JOANN Fabrics, Planet Fitness and Dunham’s Sports.
Stonemar Properties had owned the property since 2014, when it bought the location from Lormax Stern Development Co. for a reported $68 million.
Advantage Commercial Real Estate Advisers Mark Ansara and Earl Clements have managed leasing at Centerpoint for the past eight years, and have helped about 15 tenants move into the space, Ansara said. The new ownership plans to work with another brokerage for leasing, Ansara added.
“(Centerpoint) is a very strong power center,” Ansara said. “The majority of their tenants all do very well there and it’s on a very well-trafficked retail corridor. Most people go to 28th Street to do their basic shopping and people not from the area will go there as well.”
Advantage Commercial Real Estate was not involved in the Centerpoint transaction, but the sale demonstrated a “good marriage between two big institutional investors,” Ansara said.
The former Centerpointe Mall went through a $38 million de-malling process and renovation that was completed in 2013 and converted the shopping center into an open-air retail center.
“Shops at CenterPoint represented a compelling off-market opportunity to acquire a prominent, stabilized and cash-flowing power center generating tremendous sales coupled with value-add upside,” Brett Gottlieb, managing director of DRA Advisors, said in a statement. “We are excited to get to work alongside the Pine Tree team.”
The CenterPoint sale comes as the retail market in West Michigan continues to bounce back from the turbulence in the early days of the COVID-19 pandemic, according to the latest data from Colliers West Michigan.
In its second quarter retail market report for the region, Colliers noted that the retail market had a net absorption of 125,883 square feet which dipped the overall retail vacancy rate to 5.4 percent. However, the 28th Street SE corridor fared even better with a vacancy rate of 4.3 percent, despite 7,544 square feet of retail space coming on the market during the quarter.
Across the region, average asking rental rates for retail were $13.69 per square foot, but stood at $16.05 along 28th Street SE, according to the report.
As a result of the strong performance, Colliers said it tracked a higher level of transactions during the second quarter.
“The market indicates investors have noted the West Michigan retail sector’s recovery, and as a result sale activity is on an upward trend,” the authors wrote in the Colliers report.