Oceanside CA— Sterling Organization, a vertically integrated private equity real estate investment firm headquartered in Palm Beach, FL, has announced the acquisition of two assets today, adding a New York City metro property as well as its first California asset with the purchase of a San Diego shopping center to its more than 7 million-square-foot portfolio.
On the West Coast, Oceanside Town & Country, a grocery-anchored shopping center located in Oceanside (San Diego County), CA was purchased from Prudential Real Estate Investors and Kimco Realty Corporation via the firm’s institutional fund Sterling Value Add Partners II, LP for $15.7 million. The transaction was brokered by Dixie Walker and his Irvine, CA-based team at Cushman & Wakefield.
Oceanside Town and Country is an 87,740-square-foot shopping center anchored by grocery store Smart & Final Extra!. Other national and regional retailers at the center include Starbucks, T-Mobile, West Marine, The UPS Store, and Avis. The property is located at the interchange of the I-5/San Diego Freeway and Oceanside Boulevard, approximately one mile from the Pacific Ocean. More than 196,000 vehicles pass the property daily. The center, which was originally developed in the 1970s, is currently 61% occupied. Over 80,000 people live within a three-mile radius of the property, where the average household income is approximately $72,000.
“We are excited to enter the competitive California market with the acquisition of Oceanside Town & Country shopping center,” said Brian Kosoy, Managing Principal, President and CEO of Sterling Organization. “We believe the asset fits squarely in our value-add fund’s box and expect to add significant value to the asset on behalf of our investment partners over our hold period. I also must thank the great folks at Kimco and Prudential – as well as Dixie Walker and his team – all of whom made our entrée into California a most professional and facile experience.”
The East Coast asset, a 6.33-acre parcel occupied by an 85,000-square-foot Kmart in Lodi, NJ, was purchased in an off-market transaction from an undisclosed seller via Sterling Value Add Partners II, LP as well. Lodi is a Bergen County borough located approximately 15 miles northwest of New York City. Kmart anchors a larger shopping center that includes an Aldi grocery store and Blink Fitness (a division of Equinox), which were not part of the transaction. The shopping center is located on Memorial Drive, the town’s main retail thoroughfare. Over 280,000 people live within a three-mile radius of the property, where the average household income is approximately $71,000.
“The Lodi transaction also represents an excellent opportunity to add significant value on behalf of our investors in one of the country’s strongest markets,” said Mr. Kosoy. “We think we will ultimately have the opportunity to re-tenant the Kmart box with new tenants that should vastly improve the quality of the tenancy while materially increasing the rents at the property. We believe it is hard to go wrong with irreplaceable real estate in such a mature, dense, infill New York metro location.”