HARSCH SELLS ALAMEDA TOWNE CENTRE FOR $181 MILLION
Harsch, which has owned the 600,000-square-foot shopping center since 1979 and undertook an eight-year, $85 million renovation in 2002, took advantage of a red-hot market for such properties in order to gain cash for other property purchases, President Jordan Schnitzer told The Island on Thursday.
Jamestown’s managing director, Michael Phillips, promised to “continue the repositioning of the mall” by bringing “innovative” local and national retailers. In a press release, the company promised to capitalize on the shopping center’s shorefront location and Alameda’s recent population growth.
“They’ve created the shell, and it’s our job to fill it,” Phillips said. “We are committed to being a good neighbor in Alameda and to continuing the good work of Harsch.”
Schnitzer said Harsch began talking to brokerage firms in May or June about refinancing or a partial sale of the shopping center; he said the company had always planned to find a partner to take over half the property. But the company opted to sell when it learned the market for such properties was strong. A sale would also give the company money to pursue some “tremendous opportunities” for additional acquisitions this year and next.
He said Harsch was under “no pressure to sell” the shopping center, which he said carried $84 million in debt. Schnitzer said his family worked to make the center unique to the Island, with Field Paoli Architects-designed renovation details that included wood trellises, bronze animal sculptures and a fountain circled by dancing metal frogs.
“It’s just been a labor of love,” Schnitzer said.
Schnitzer said the Safeway and Trader Joe’s stores at the shopping center are some of those grocery chains’ top performing stores. But the center has had its share of struggles too, losing out on a Target store following still community opposition and an Orchard Supply Hardware store that was slated to come but didn’t due to the poor economy.
The center is now at 90 percent occupancy, said Michael Corbitt, Harsch’s retail portfolio manager for Northern California, and that includes six new tenants that have come to the center in the last few months.
“There’s great momentum,” Corbitt said.
Alameda Mayor Marie Gilmore praised Harsch for their commitment to the Island.
“Harsch Investment Properties has been a wonderful owner of Alameda Towne Centre from the city’s point of view. They worked closely with the planning department, City Council, and always put the community first,” Gilmore was quoted as saying in a press release.
Family-owned Harsch owns 21 million square feet of property across five Western states. The company received 18 offers for the shopping center, which is home to 70 tenants, they said in a press release.
Jamestown, a German-owned pension fund with headquarters in Atlanta, has $4 billion in equity that includes 80 properties encompassing 25 million square feet. Other properties owned by Jamestown include New York’s One Times Square and Chelsea Market and San Francisco’s Pacific Place, which houses Old Navy’s flagship store and the Hotel Palomar.