DDR Opens 900,000-Sq.-Ft. Belgate Shopping Center

By Eliza Theiss, Associate Editor

Beachwood, Ohio-based DDR Corp., an owner and manager of value-oriented shopping centers, has announced the opening of Belgate Shopping Center near I-85 in Charlotte, N.C. The 900,000-square-foot value-oriented center is DDR’s first ground-up domestic development since the 2008 market crash, proving not only the developer’s confidence in the Charlotte economy, but also acting as a clear sign of market recovery.

Moreover, the project is expected to attract further commercial development along the I-85 University City corridor.

The fully leased shopping center is anchored by a 176,000-square-foot Walmart and a 367,000-square-foot IKEA, with the latter being the only location of the Swedish furniture retailer between Washington, D.C. and Atlanta. That alone expands Belgate’s trade area to approximately two million shoppers.

The asset’s junior anchors include Marshalls, Old Navy, Furniture Row ULTA Beauty, Shoe Carnival and Hobby Lobby—a tenant mix that will fully benefit from the stable traffic generated by the nearby UNC Charlotte campus, boasting an enrollment in excess of 30,000 students. Traffic is expected to increase in the future with the Charlotte Area Transit System‘s expansion to University City.

“Belgate represented a unique opportunity to take over a stalled development project, and by leveraging our operating platform, we were able to deliver growth opportunities for our retail partners and our shareholders,” declared Paul Freddo, senior executive vice president of leasing and development for DDR. He added that not only has the power center opened ahead of schedule, but it has also surpassed the development return threshold with an over 10 percent unlevered cash on cost return.

Prior to DDR’s takeover of the project, the power center’s development had been stalling for several years. With the addition of Belgate Shopping Center, DDR now owns and manages four million square feet of gross leasable area in the Charlotte metropolitan area, making the Queen City region the company’s fourth largest market after San Juan, Atlanta and Chicago. Other DDR retail properties in the region include the 2012-acquired Cotswold Village and Carolina Pavilion in Charlotte.

You can read more about the acquisition of Carolina Pavilion here.

For further Charlotte market data, click here

Photo courtesy of DDR Corp. via PRNewswire

Landmark Pays $21M for 380-unit Victoria Park

By Eliza Theiss, Associate Editor

Richmond, Va.-based Landmark Apartment Trust of America Inc. has announced two acquisitions in the Carolinas totaling 600 units. The transactions, worth a combined $36 million, include the 380-unit Victoria Park in North Carolina’s booming Charlotte metropolitan area and the 220-unit Reserve at River Walk in Columbia, S.C. Featuring an array of attractive amenities, the two apartment complexes have a combined occupancy rate of 95 percent.

“The addition of these assets to our portfolio aligns with our disciplined investment strategy of acquiring assets in high-growth Southeastern markets at a discount to replacement cost,” declared Stanley J. Olander, chief executive officer of Landmark. “We are confident our proven operating platform strategy will maximize the potential of each asset, unlocking unrealized cash flow opportunities.” Oleander also predicted value-add renovation work will be undertaken at both properties.

Victoria Park’s 4616 Stoney Trace Dr. address locates it within the town of Mint Hill with swift access to Charlotte’s major employment and entertainment opportunities, while at the same time offering the peaceful atmosphere of suburbia. The community boasts several resort-style amenities such as both indoor and outdoor swimming pools, a multi-sports court, picnic area, playground and lush landscaping. Other community privileges include a fitness center, 24-hour clothes care center, Wi-Fi café, onsite business center and resident activities program.

Apartment amenities include walk-in closets, a gourmet kitchen, dishwasher and private balcony, with larger units boasting wood-burning fireplaces. Victoria Park is comprised of one-, two- and three-bedroom units ranging from 645 to 1,306 square feet. Rents start at $505 and go up to $950 per month.

Victoria Park’s individual purchase price was $21 million.

Click here for more Charlotte market data

Photo credits: Victoria Park’s Facebook page

22-Story Second Ward Mixed-Use Development on Track for Completion

By Eliza Theiss, Associate Editor

What was once an unfinished eyesore in Charlotte’s Uptown is now shaping up to be a prized downtown asset. Formerly named The Park, the 21-story building under development at the corner of South Caldwell and East 3^rd Streets is now known as SKYE Condominiums—but the mixed-use development will feature far more than just condos.

Alongside the 67 luxury condo units, two penthouse suites will also be featured, as well as a 172-key limited-service hotel, street-level retail, a rooftop restaurant and bar. The property’s condo component will take up floors 14 through 19 and will be made up of one- and two-bedroom condominiums in several layouts, with floor spaces starting at 700 square feet for one-bedroom units and reaching 2,500 square feet for two-bedroom condos.

All units feature state-of-the-art stainless steel appliances, granite countertops and large-scale terraces. Both penthouse suits will be located on the 21^st floor, offering sweeping views of Uptown Charlotte and 3,500 square feet of open living space. The three-bedroom, three-and-a-half bathroom units also offer a two-story great room, formal dining room, and gourmet kitchen with a wet bar, among other features.

SKYE Condominiums residents will enjoy amenities such as a theatre room, fitness center, rooftop pool and sun deck, demonstration kitchen and wet bar, party room, game and billiards room, lounge complete with an E-room, private mail room, additional storage space, and bicycle storage. Other building amenities include a green roof with open space walkways, 24-hour security and concierge service, five high-speed elevators, resident room service, and valet parking.

The property’s ground floor will be taken up by retail, while part of the rooftop will be occupied by a restaurant and bar. The property will also feature a five-story parking garage with three levels of residents-only, controlled access.

The high-rise is seeking LEED certification from the U.S. Green Building Council. The McDevitt Agency is the designated broker for SKYE’s 67 condos, of which, according to the Charlotte Business Journal, 24 are already under contract. The same source reports the first residential units will be delivered in the third quarter of the current year, with the hotel component, a 172-key Hyatt dubbed Hyatt Place Charlotte/Downtown, opening late in the third quarter as well. In the lead-up to the September opening of the hotel, which will occupy the lower levels of the high-rise, Hyatt veteran Don Lockhart has been appointed general manager.

SKYE’s current owner and developer, Small Brothers Charlotte LLC, acquired the building, then an unfinished 106-unit condo project, in 2009 for a little over $4.5 million. It subsequently increased its area ownership by purchasing two adjacent parcels to increase pedestrian and vehicle access to the high-rise. Award-winning international design firm Perkins Eastman is architect of the project, while Cleveland Construction Inc. is the designated construction management firm.

For more market data from Charlotte, click here.

Image courtesy of SKYE Condominium’s Facebook page

Adolfson & Peterson Buys Charlotte Location for $2.5M; Fifth Third Center Applauded for Energy Efficiency

By Eliza Theiss, Associate Editor

Minneapolis-based Adolfson & Peterson Construction (A&P) has announced its purchase of the Fowler Building, the company’s Charlotte location. A&P moved into the South Tryon Street building in March 2012, leasing 8,300 square feet of the property’s gross leasable area of 18,000 square feet.

Built in 1928, the property is located in the historic South End neighborhood conveniently close to Charlotte’s light rail system and Uptown—a definite advantage of the property. A&P will invest in the property’s vacant space to convert it into additional office space, which is needed due to its increasing employee roster. Such includes part of the third floor and basement area.

A tenant currently leasing 3,500 square feet on the third floor will continue to occupy its current space. The Charlotte Business Journal identifies the tenant as IT consulting firm Systemtec. A&P, represented by Josh Beaver of The Nichols Co., paid a reported $2.5 million for the Fowler building, purchasing it from Boulevard at 1447 South Tryon Street LLC—represented by Greg Pappanastos of Argos Real Estate Advisors.

In other news, Parmenter Realty Partners announced that Fifth Third Center, one of its Charlotte assets, has been named among the top three energy saving buildings in the “Over 500,000 Square Foot” category of the Smart Energy Now® Building Recognition Program. Smart Energy Now® is Duke Energy’s program dedicated to aid in lowering energy consumption in Charlotte’s Uptown office properties, with a focus on changing employee attitudes and habits in relation to energy consumption.

Located at 201 North Tryon St., Fifth Third Center is a LEED Silver and Energy Star-certified marquis trophy tower. The 30-story Class A office building features 654,533 square feet of office space, as well as an attached ten-story, 1,030-car parking garage. Parmenter Realty purchased the asset in mid-2012 from Parkway Properties in one of the year’s biggest deals in Charlotte, paying $245 million for the coveted asset (click here to read more about this transaction).

For further Charlotte market data click here.

Photo courtesy of Adolfson & Peterson Construction

32-story Uptown Office Building Hits the Market

By Eliza Theiss, Associate Editor

Following hot on the heels of last week’s sale of One Wells Fargo Center (read more about the transaction here), another uptown office high-rise has just hit the market. Though not as hot an asset as the one-million-square-foot Wells Fargo trophy tower, the 121 West Trade office tower is still very much an attractive property.

121 West Trade, previously known as the Interstate Tower, has been listed for sale with CBRE Group Inc., according to a Charlotte Business Journal report. The property, located at the corner of Trade and Tryon Streets, is 72 percent occupied, with it largest tenant—Chicago Bridge & Iron Co.—taking up a 117,000-square-foot lease set to expire in 2018. The property also houses the members-only Charlotte City Club on its top floor.

Faison Enterprises Inc. developed the 32-story office building in 1990. An affiliate of the company, Tryon Street LLC, sold the property in 2006 to Tryon Tower LLC, an affiliate of Cornerstone Real Estate Advisers LLC. The entity, current owner of 121 West Trade, paid $52.3 million for the asset.

The office tower features 330,000-square-feet of Class A office space. Amenities include a 260-car, eight-floor parking garage, onsite management by Spectrum Properties, 24-hour security service, an outdoor courtyard with water features, 360-degree views of Charlotte, and upgraded fixtures and finishes. The property features street-level retail as well. The Kohn Pedersen Fox Associates-designed office high-rise features a classical architectural look with limestone, granite and marble exteriors.

Click here for more Charlotte market data.

Photo courtesy of Civilengtiger via Wikimedia Commons

Starwood Picks Up One Wells Fargo Center Trophy Tower

By Eliza Theiss, Associate Editor

Leading private investment firm Starwood Capital Group has announced that one of its affiliates, New Jersey-based Vision Equities, in partnership with Mountain Lakes, has acquired One Wells Fargo Center—one of Charlotte’s trophy office buildings. The off-market purchase was made at a yet to be disclosed price.

Previous owner Childress Klein Properties will stay on to handle property management and leasing under a long-term agreement with the new owners. The office tower had been under Childress Klein’s ownership for 25 years.

“We are pleased to be acquiring one of the premier office buildings in Charlotte’s central business district. 1 Wells Fargo Center is a welcome addition to our portfolio, as it is a high-quality asset with a strong tenant roster that will generate significant cash flow for years to come,” declared Starwood Capital Senior Vice President Mark Keatley.

The high-quality Class AA office building is located in Charlotte’s central business district and features one million square feet of office space. The property is 98 percent-leased to long-term tenants. Seven of the property’s nine largest tenants, occupying 92 percent of the total rentable area, have been in One Wells Fargo Center for over 20 years and have average remaining leasing contracts averaging 7.5 years. An added bonus of the property is that circa 70 percent of its in-place income derives from investment grade tenants.

Amenities at the 42-story office tower include a seven-level underground parking garage of approximately 1,100 parking spaces; a 24-hour on-site security with controlled visitor and tenant access; shops and service providers such as a coffee house, dry cleaner and sundry store; a YMCA; casual and fine dining venues; and part of Wachovia Center—a hub of offices, restaurants, shops, venues and businesses spanning three city blocks.

For more Charlotte market data click here.

Image courtesy of Kozo via Wikimedia Commons

Crescent Communities Breaks Ground on 63-Acre Mixed-Use Alexander Village in Charlotte

By Eliza Theiss, Associate Editor

Crescent Communities (formerly known as Crescent Resources) has announced breaking ground on the 63-acre health club-inspired Alexander Village. The ambitious project is being developed on Senator Royall Drive close to University Research Park, an area presenting high growth numbers. The mixed-use development is set to be constructed in several phases and is inspired by Crescent Communities’ award-winning Palmetto Bluff Resort located in Bluffton, S.C.

The $33.6 million Phase One of Crescent Alexander Village is the multi-use development’s 27-acre residential component. The garden-style luxury apartment community will comprise 320 units. Buildings will feature a vernacular classical design, such as stonework reminiscent of 18th-century stone homes—present in the community’s clubhouse, as well as several seaside resort-type elements such as an outdoor yoga lawn. Eight of the 320 units will be cottages intended as corporate apartments.

Community amenities include a clubhouse that will target LEED certification, a state-of-the-art health club, business center, clubroom, gaming area, catering kitchen, outdoor kitchen, outdoor fireplace, lounging areas, resort-style saltwater pool, aqua sundeck, bocce courts, amphitheater, scenic pond with fitness trail, and an expansive, wooded dog park.

“We are creating a community that will be an ideal complement to the continued growth in high-level career opportunities within University Research Park,” declared Brian Natwick, president of Crescent’s multifamily group, in a news release.

Further development phases include 250,000 square feet of office space, up to 75,000 square feet of retail, and a hotel. The project is a registered member of the Audubon International Signature Program and is working towards becoming  a Certified Signature Sanctuary. Regions Bank is project construction lender.

For more market data from Charlotte, click here.

Image courtesy of Crescent Communities

Chart courtesy of Marcus & Millichap

New Apartment Projects Rumored in Charlotte

By Eliza Theiss, Associate Editor

Rumors of new multifamily projects have been abound lately. Following Gvest Partners’ recent announcement of developing a $37 million 342-unit apartment complex in the artsy NoDa neighborhood of Charlotte, another hot submarket within the city could see a brand new apartment community. According to the Charlotte Business Journal, Woodfield Investment Trust LLC is conducting due diligence on a two-acre property in the vicinity of the future BB&T Ballpark.

Even though no official statements have yet been released, rumors of the company planning to develop a 230-unit apartment community near the ballpark have been circulating for months. Currently, however, Woodfield has the site under contract, which is empty save for a 13,000-square-foot industrial structure. If the company moves forward with the project, plans call for 230 units spread across four levels complete with a two-level car park.

Located in close proximity to the Bank of America Stadium, the Third Ward is set to become even hotter with the Charlotte Knights minor league baseball team’s new $54 million stadium currently under construction. The 10,000-seat stadium broke ground earlier this years and is slated to open in time for the 2014 season. It is expected to not only generate healthy tax income, but also a boom of new developments in the surrounding area—from office projects to hotels to multifamily projects.

Woodfield currently has two other multifamily projects under construction in Metrolina and expects to break ground on two more before the year is out. One of the planned communities will be developed in the NoDa district. It owns several completed projects in the city as well, such as the Gramercy Square at Ayrsley.

In other multifamily news, Crescent Communities LLC (previously known as Crescent Resources) is also rumored to be looking to develop a 300-unit apartment community in the Midtown area. According to the Charlotte Business Journal, Crescent will buy up about two acres of property at the intersection of East Morehead and Harding Place in order to construct a community featuring underground parking. The alleged site currently holds some low-rise office properties.

Image courtesy of Woodfield Investments’ Facebook page

Chart courtesy of Marcus & Millichap

$37M Apartment Complex Planned for NoDa, Speculative Office Space for Mooresville

By Eliza Theiss, Associate Editor

Gvest Partners LLC, a closely held real estate investment partnership that focuses on the acquisition, development and management of commercial real estate and renewable energy assets, has announced plans for a $37 million apartment development in Charlotte. According to the Charlotte Business Journal, Gvest plans to build a 342-unit apartment complex in the city’s NoDa neighborhood.

Expected to break ground within a few weeks, The Yards at NoDa will consist of eight four-level buildings spread across 10 acres west of North Brevard St. The developer purchased the plot in early 2012, which, according to the report, has been rezoned for proper land use. Gvest paid $4 million for the land.

The community, which will rise in close proximity to a station of the planned extended light-rail line, will feature studios, one-, two- and three-bedroom units, as well as two townhomes.  Amenities will include a fitness center, resort style pool, clubhouse, dog park and surface parking. The community will also mirror NoDa’s vibrant, walkable, urban vibe with features such as graffitied walls.

The property is expected to be completed in 16 months. Construction financing was provided by Well Fargo & Co.

In other news, signs of market recovery are beginning to show in Metrolina as well, with ideas and rumors of speculative development in the Greater Charlotte area creating a buzz. According to a report by the Charlotte Business Journal, Merinos Home Furnishings owner Michael Bay is considering redeveloping some of the available space at his Mooresville store into office space.

With the Merinos home furnishings store taking up about half of the available 1.1 million square feet of space, Bay is reportedly considering renovating 82,000 square feet into speculative office space.

Photo courtesy of Merino Home Furnishing Warehouse’s Facebook page

SunTrust to Anchor 105,000-Sq.-Ft. Sharon Square Office Component

By Eliza Theiss, Associate Editor

Atlanta-based SunTrust Banks Inc. is consolidating its Charlotte area operation and has chosen Pappas Properties’ SouthPark mixed-use development as its future location. According to a report by the Charlotte Business Journal, SunTrust has signed a 43,500-square-foot lease at Sharon Square, which translates into the second and third floor of a five-story 105,500-square-foot Class A office building set to break ground in May. The new location will act as SunTrust’s Charlotte headquarters beginning in the second quarter of 2014, the planned date of relocation.

SunTrust’s Charlotte presence includes a 30,000-square-foot office building under its ownership and an approximately 30,000-square-foot lease in a SouthPark office building. Some of its operations from these locations will be consolidated at Sharon Square, where the company plans to open street-level retail branch.

Pappas Properties is developing Sharon Square with the Allen Tate Co. The four-phase property is currently adding a $52 million Phase Two, which broke ground in September 2012.  It comprises two luxury residential buildings with street-level retail space, as well as a 445-car parking facility.

As previously reported on this page, retail will occupy 22,000 square feet and will contain restaurants and high-end boutiques. Some of the amenities of the residential component will include private courtyards, landscaped garden terraces, fitness center and elevated pool terraces. According to the Charlotte Business Journal, units will include one-, two- and three-bedroom apartments with the first units completed in Fall 2013 along with the retail space.

Phase One of the project opened in August 2012 and is anchored by Charlotte’s first Whole Foods store with a total surface of 48,000 square feet.

Image courtesy of pappasproperties.com