Stockbridge, a private equity real estate investment management firm based in Atlanta, has acquired most of the Village at Waterside shopping center near Hamilton Place mall for $50.8 million as part of a half dozen properties the firm recently bought across the Southeast.
A partnership organized by Stockbridge, known as SCG BR Waterside LP, acquired four tax parcels, including those anchored by REI, Burlington, Haverty and Publix, in the Waterside development just north of Shallowford Road between Interstate 75 and Gunbarrel Road in East Brainerd, according to filings with the Hamilton County Register of Deeds.
Branch Properties will continue to manage the shopping center and maintain a minority interest in the new ownership group. The Atlanta-based Branch Properties bought the sites from the Defoor Brothers, who originally developed the Waterside complex and still own the Embassy Suites hotel and other nearby properties.
In an announcement of the purchase, Stockbridge said it is buying majority control of the Village of Waterside in Chattanooga and five similar commercial developments - the Burnt Store Marketplace in Punta Gorda, Florida; Village Shoppes of Sugarloaf in Lawrenceville, Georgia; Five Forks Corners in Lilburn, Georgia; Waterford Village in Wilmington, North Carolina; and Lightfoot Marketplace in Virginia Beach, Virginia.
"As the grocery-anchored retail sector remains a resilient asset class, the opportunity to invest in a high-quality, diversified portfolio provides a significant investment opportunity for Stockbridge," Stockbridge Managing Director, Acquisitions David Nix said in an announcement of the purchase. "These six operating properties are all dominant retail centers anchored by premier grocers, and we are looking forward to partnering with Branch, a best-in-class retail operator, to generate long-term success across the portfolio."
Over the next year, Stockbridge said it plans to acquire an additional six properties, bringing the total portfolio to 1.25 million square feet. Branch Properties will maintain minority ownership in the portfolio and will continue to handle management and leasing at the property level.
"Branch is excited about the prospect of partnering with Stockbridge on this collection of high-performing properties that continue to benefit from being located in some of the most dynamic markets in the country," Branch Chief Investment Officer Jesse Shannon said in a statement. "This is a strategic relationship for Branch given Stockbridge's exemplary reputation as a partner and its stellar return performance."
The sale of the Village at Waterside is the second major East Brainerd commercial property to be sold so far this year to a national real estate investment firm wanting to buy into the Chattanooga market. A Chicago-based investment firm recently acquired the Atrium medical complex on Gunbarrel Road for $27.6 million.
Remedy Medical Properties Inc., which owns and manages over 25.3 million square feet of medical offices and facilities in 42 states, bought the site from Chattanooga 1931 Medical Properties LLC at 1949 Gunbarrel Road. The 43,724-square-foot complex was built in 1993 and is leased for medical offices operated by CHI Memorial Hospital.
Contact Dave Flessner at dflessner@timesfreepress.com or 423-757-6340. Follow him on Twitter @dflessner1.