Kite Realty Group Trust has formed a joint venture to acquire high-quality retail properties with a fund managed by TH Real Estate, a Nuveen company. KRG contributed three properties valued at $99.8 million to the joint venture in exchange for a 20% ownership interest and $89 million in net proceeds.
KRG will serve as the operating member responsible for day-to-day management of the properties and will receive property management and leasing fees. KRG used the net proceeds received from the transaction to pay down its revolving line of credit. The joint venture obtained a 10-year $51.9 million fixed-rate loan on the properties at an interest rate of 4.09%.
“We are excited to be working with TH Real Estate in this endeavor,” said John Kite, KRG’s Chief Executive Officer. “Our two teams work very well together, and we hope to find additional opportunities to acquire desirable properties to expand our relationship.”
The initial properties in the venture have a combined 418,000 square feet (“SF”) of gross leasable area and consist of the following:
Livingston Shopping Center: 140,000 SF in Livingston, New Jersey – tenants include TJ Maxx, Nordstrom Rack, DSW, buybuy Baby, Cost Plus World Market, and Ulta Beauty;
Plaza Volente: 156,000 SF in Austin, Texas – tenants include H-E-B Grocery, Starbucks, Great Clips, and Jersey Mike’s; and
Tamiami Crossing: 122,000 SF in Naples, Florida – tenants include Ross Stores, Stein Mart, Marshalls, Michaels, PetSmart, Aldi, and Ulta Beauty.
“We are very excited to partner with Kite Realty Group, whom we consider a best in class operator of open-air retail centers. The two teams have collaborated on this venture and we hope to grow our relationship over time,” said Mike Fisk, Managing Director of Retail Investments at TH Real Estate.
TH Real Estate, an affiliate of Nuveen (the investment management arm of TIAA), is one of the largest real estate investment managers in the world with $114 billion in assets under management. Managing a suite of funds and mandates spanning both debt and equity across diverse geographies, sectors, investment styles and vehicle types, TH Real Estate provides access to every aspect of real estate investing.