The Real Deal Miami

TIAA sells Palms at Town & Country in Kendall to Weingarten: $285M

Property was expected to fetch bids of up to $335 million

August 01, 2016 08:45AM
By Sean Stewart-Muniz

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The Palms at Town & Country (Inset: Drew Alexander, President and CEO OF Weingarten Realty Investors)

The Palms at Town & Country (Inset: Drew Alexander, President and CEO OF Weingarten Realty Investors)

In one of South Florida’s largest investment deals so far this year, Weingarten Realty Investors just closed its $285 million purchase of the Palms at Town & Country open-air shopping center in Kendall.

Weingarten, an investment trust based in Houston, announced the purchase Friday as part of its second-quarter earnings call. The seller is TIAA, a New York-headquartered financial services provider for academics and government employees that has about $861 billion in assets under its management.

According to county records, Weingarten made its purchase through an affiliate company named after the shopping center. Its managing member is Asset Preservation, a firm that specializes in facilitating 1031 exchanges. The exchanges are part of the U.S. tax code that allow property owners to sell their real estate and defer any taxes on their capital gains, as long as they re-invest in another property.

TIAA began shopping the massive 70-acre retail complex to potential buyers late last year, with bids expected by some to have reached as high as $335 million — though there was never a publicized asking price.

At 664,000 square feet, the Palms at Town & Country is Kendall’s second largest shopping center, falling only behind Dadeland Mall, which has 1.4 million square feet of floor space. The center also underwent a major renovation in 2010.

Commercial brokerage HFF represented the seller and said through an announcement that Weingarten made its purchase free and clear of existing debt.

Weingarten, which focuses its business solely on trading and developing shopping centers, made the purchase out to be a major coup in its announcement: the company said Palms at Town & Country makes 87 percent of its revenue off national tenants like Publix, Kohl’s, Dick’s Sporting Good and Marshalls. And the center services both Kendall and West Kendall, which the company described as wealthy and affluent neighborhoods.

“Its trade area buying power, a combination of median household income and density, is comparable to the most successful properties in the state including Aventura and Dadeland Mall,” Drew Alexander, president and CEO of Weingarten, said in the announcement.

The purchase marks Weingarten’s second major retail acquisition in South Florida during the second quarter, the first being its $92.75 million purchase of the Deerfield Beach Mall.

Much like Palms at Town & Country, the Deerfield mall is occupied by national tenants like Publix and TJ Maxx, and had few vacancies at the time of its sale.