VOL. 126 | NO. 20 | Monday, January 31, 2011
Boyle Fund Pays $14M for Germantown Mall
By Sarah Baker
Boyle Investment Co. has made its first Memphis acquisition since setting up its Midsouth Capital Fund I LLC by acquiring a significant amount of Belz Enterprises Inc.’s interest in Germantown Village Square Shopping Center.
Germantown Poplar Investments LP and Germantown Village Square Joint Venture bought a majority interest in the center for $14 million from Belz Investment Co. LP, an affiliate of Belz, according to the Shelby County Register of Deeds.
Boyle will handle the leasing and management of the 200,000-square-foot, two-level, mixed-use center, which originally was developed in 1973 as an enclosed shopping mall and then was subsequently “demalled” in 1985.
“We are extremely excited about this acquisition,” Bayard Boyle Jr., chairman of Boyle, said in a statement. “Though we have had a wonderful relationship with Belz for many years, this is our first joint venture. Our two firms will work well together because we share a cautious and meticulous investment philosophy. We look forward to working with Belz to maximize the value of the center.”
Germantown Village Square, 7670 Poplar Ave., is at a prominent, high-traffic location in the heart of Germantown Road’s north-south traffic corridor and offers appealing demographics. The center contains a strong mix of nationally known retailers and smaller, locally owned shops.
Major retailers at the center include TJ Maxx, Pier One, Office Max, PETCO, Designer Shoe Warehouse and McAlister’s in addition to office users including, but not limited to, Methodist Healthcare and Crye-Leike Inc.
The sale marks Belz’s third high-profile Memphis deal in the past month. The longtime Memphis commercial, office and industrial development company sold Park Place Centre for $10.3 million to Loeb Properties Inc. at the end of December and Eastgate Shopping Center to a Dallas-based entity for $31.5 million earlier this month.
“We have the greatest respect for the Boyle organization and have worked with them over the years on community affairs and industry related matters,” Ron Belz, president and chief operating officer of Belz, said in a statement. “Our companies are alike in many ways and I believe our individual strengths and experience will provide a great synergy. We are pleased to have the opportunity to advance our relationship to this new level.”
The Midsouth Capital Fund targets $80 million in real estate investment opportunities throughout the Mid-South region, with a special focus on Memphis and Nashville. Additional markets include Kentucky, north and central Alabama, Mississippi and Arkansas.
Boyle already leases and manages more than 1 million square feet of retail space and almost 2 million square feet of office space in the greater Memphis area. Shopping centers developed and currently leased and managed by Boyle include both Regalia and the Shops of Humphreys Center in East Memphis, the Shops of Forest Hill in Germantown, Gallina Centro in Collierville, and Southcrest Market in Southaven, Miss.
The Midsouth Capital Fund’s acquisition of Germantown Village Shopping Center will add another 140,000 square feet of retail space and 60,000 square feet of office space to the company’s Memphis portfolio of retail and office properties that it leases and manages.
Current initial equity capital committed to the Midsouth Capital fund I is $32 million with an ultimate goal of $40 million, with Boyle Investment Co. and related entities contributing $10 million of the total.
The equity commitment is expected to grow over the next few months as additional investors from Memphis and Tennessee are added and approximately $80 to $100 million in real estate opportunities will be targeted. The Midsouth Capital Fund I prefers a $1 million minimum equity commitment and is seeking sellers who are looking for greater liquidity.