The California Public Employees’ Retirement System and JV partner First Washington Realty, have bought a stake in a portfolio of 86 shopping centres valuing it at $1.73 billion.
The investment partners are buying a 60 percent interest in a portfolio, including many shopping centres sold in 2005 to Macquarie CountryWide Trust of Australia, for a price reflecting $2.74 billion, said CalPERS.e
In the 2005 deal, the JV sold 100 properties to Macquarie which took a 75 percent stake, and Florida-based Regency Centers Corporation, which acquired a 25 percent ownership.
According to a statement by CalPERS, the pension is paying $463 million. Regency Centers is retaining its 25 percent interest in the portfolio.
The package includes sixteen grocery store-anchored shopping centres in San Francisco, Los Angeles and San Diego metropolitan areas of California.
“People will always need to go to the supermarket, which make these properties recession-hardy as well as valuable in periods of economic growth,” said Ted Eliopoulos, senior investment officer at the retirement plan. It’s a great example of opportunities opening up for us, and a preview of what our program will look like as we pursue even more core, cash-yielding properties at attractive prices.”
The $185 billion pension has been trying to combat heavy losses in their private equity and real estate holdings over the past year.
In July it reported a 36 percent fall in its real estate holdings over the 12-month period ending 31 March. CalPERS saw a total decline in the value of its assets of 23.4 percent over the 12-month period ending 30 June, 2009. “It was the most severe single year decline,” the pension said in a statement.