By Meghan Hall
Weingarten Realty, a real estate investment trust (REIT) that focuses on the acquisition, management and development of neighborhood retail assets, has closed on a deal to buy the Covington Esplanade for $37.37 million. In the transaction, which closed Monday, Weingarten purchase the Home Depot-anchored center from New York-based Clarion Partners, according to King County property records.
The Covington Esplanade, located at 27027 185th Ave. SE. in Covington, Wash. Is also home to an IHOP Restaurant, Massage Envy, Bank of America, Starbucks and Mizu Japanese Steakhouse, among other retailers. The retail center is in a largely residential suburb, although two shopping centers, anchored by a Safeway and Kohl’s, respectively, are located just west on State Route 516.
Clarion originally acquired the property in 2012 for $31 million, and the property totals 187,000 square feet.
“Covington is a highly desirable, family-oriented town with strong employment and household growth,” said Stephen P. Latimer, Managing Director at Clarion Partners at the time of the retail center’s acquisition. “With its outstanding list of tenants and attractive location, the center is well positioned to take advantage of the expanding retail sales and improving economic fundamentals anticipated for the area.”
The Covington Esplanade is not Weingarten’s only property in the Puget Sound; the firm also owns six other properties throughout the state of Washington, including 2200 Westlake, an87,000 square foot center anchored by a Whole Foods and located at the heart of downtown Seattle, and Queen Anne Marketplace and Rainier Square Plaza.
According to a recent press release dated November 11that detailed the REIT’s transaction activity, Weingarten’s acquisitions this year total $209 million and includes five grocery-anchored centers in geographies with strong demographics. Its dispositions to-date total $433 million, and the company intends to increase its acquisitions guidance range to between $175 and $275 million. The demographics for the 2200 Westlake property alone are strong; within a one-mile radius there are 75,297 residents with an average household income of $106,229. Queen Anne boasts similar demographics, with 47,000 residents within a one-mile radius whose earnings come out to about $125,000 annually. As of this writing, Weingarten did not have demographics available for the Covington Esplanade.
“We are extremely pleased with the execution of our strategy to upgrade the quality of our portfolio as evidenced by the transactions we have closed. As we move into 2020, we are optimistic that we are well positioned for FFO growth,” said Drew Alexander, president and chief executive officer. “We see this through NOI acceleration from our development projects and continued acquisitions, coupled with reduced dispositions next year, which should not exceed $150 million. With the quality of our portfolio along with our best-in-class balance sheet, we are well positioned to accelerate this growth into the future.”
Clarion Partners has also been active in the Puget Sound in recent months, spending $81.1 million in June to acquire three warehouse and distribution facilities in Des Moines that total 551,998 square feet less than five miles from SEATAC. In April, Clarion also acquired a 100,520 square foot warehouse in Renton for $15 million.