Regency Centers Purchases Calhoun Commons Amid Strengthening Retail Market
- Jul 10, 2011
Regency Centers purchased the 66,000-square-foot Calhoun Commons shopping center near Lake Calhoun for $21 million, bringing its portfolio in the Twin Cities to four shopping centers, with a fifth under contract.
Calhoun Commons’ seller, Bloomington-based Doran, built the property in 1999 (it still owns Sydney Hall/Dinky Dome in Minneapolis). The Class A shopping center is fully leased and is now anchored by a 49,471-square-foot Whole Foods Market, along with national retailers such as Chipotle Mexican Grill, Caribou Coffee, Ben & Jerry’s and Noodles & Company. The award-winning retail center consists of three buildings and includes beautifully landscaped grounds and walkways, as well as large sculptures.
The acquisition is part of Regency Centers’ long-term strategy to own high-quality shopping centers. Its portfolio totals 396 properties around the country, some held in co-investment partnerships. Its dominant anchor tenants are grocery stores, a segment less affected even in a challenging economy.
Studies indicate that this year the retail segment in Minneapolis is showing promise. According to Marcus & Millichap Real Estate Investment Services, vacancy rates in this sector should drop 30 basis points, to 8.9 percent, throughout 2011. The rate fell 30 basis points last year, too.
Rents should increase slightly in the retail sector in 2011. According to the report, Twin Cities retail operators will raise asking rents 0.2 percent to $17.20 a square foot. Effective rents will rise, too, by 0.8 percent to $14.77 a square foot.