Tampa investment firm pays $16.8M for Kissimmee Walmart-anchored center

A Tampa investment firm that specializes in mid-market grocery-anchored retail centers paid $16.8 million this month to enter the greater Orlando market via Kissimmee.

East Coast Acquisitions (ECA) purchased the Walmart Neighborhood Market-anchored Vine Street Square in a deed that posted Sept. 13. Founder and Managing Principal Christopher Wild told GrowthSpotter the asset fit perfectly in ECA's core strategy.

"It fit right into the mold of what we look for, which is grocery-anchored, service-driven neighborhood centers," he said Friday. "We feel like this center feeds the need of the community with a lot of service providers and restaurants."

Having a Humana community outreach center and CAC medical office in the tenant mix of this particular plaza adds foot traffic and makes it less susceptible to competition from e-commerce providers, he said.

Built in 1987, Vine Street Square sits on 17.3 acres at the corner of U.S. 192/Vine Street and Dyer Street. It has 118,000 square feet of inline retail plus two outparcel buildings, currently occupied by SunTrust and Mattress One.

"We feel like there's value-add potential from the two outparcels we took on as part of the deal," Wild added.

The plaza had two vacancies at the time of the sale and several leases up for renewal in the next 18 months.

Wild said ECA plans to make immediate capital improvements to the property, most notably replacing the roof. The firm factored that cost estimate, as well as other deferred maintenance, into the purchase price.

ECA sourced a $12.5 million loan from private equity lender Benefit Street Partners.

The seller was an affiliate of Cincinnati-based grocery store REIT Phillips Edison & Company, which now has nine properties in the greater Orlando market. Tampa-based Plaza Advisors represented the buyer and seller.

Now that ECA has entered the Orlando market, the firm will be looking to expand its portfolio here to maximize its economies of scale.  Wild said the firm accquires about six properties per year and typically holds onto an asset for five to 10 years with targeted (internal rate of return) at between 15 and 25 percent.

Have a tip about Central Florida development? Contact me at lkinsler@GrowthSpotter.com or (407) 420-6261, or tweet me at @LKinslerOGrowth. Follow GrowthSpotter on Facebook, Twitter and LinkedIn.