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Edgewater Mariano’s and Whole Foods Properties Sold To New York-Based Firm

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Photo by CoStar Group

When Safeway decided to close all its Dominick’s grocery stores back in 2014, it set off a firestorm. Loyal customers were sad about the closures, but others saw this as a chance to buy real estate at a good deal.

One of those opportunists was California-based Loja, a private equity real estate investment firm. They gobbled up several of the Dominick’s properties for $95 million. Now, Loja is selling all seven of its Chicago real estate investments (and four other properties outside of Chicago) to New York-based Clarion for $218 million.

The Chicago properties sold include two Edgewater stores: Whole Foods at 6009 N. Broadway and Mariano’s at 5201 N. Sheridan. The other five area stores are Mariano’s at 2021 W. Chicago Ave., Mariano’s at 1900 S. Cumberland Ave. in Park Ridge, Whole Foods at 1101-1137 Chicago Ave. in Evanston, Trader Joe’s at 1211-1229 Chicago Ave. in Evanston and Trader Joe’s at 1600 S. Milwaukee Ave. in Libertyville.

The deal affects the real estate only, not the tenants. The four properties outside of Chicago Clarion bought from Loja are in Colorado, California, Florida and Minnesota.

According to a Crain’s Business article, the sale which comes amid strong demand for single-tenant retail properties with long-term leases in place, was timed due to the 2016 presidential election.

Loja CEO Thomas Engberg said, “Real estate valuations are very high right now, and we like to buy opportunistically and sell opportunistically. The second factor was uncertainty about the election. We weren’t sure how the world was going to look on Nov. 9. We went to cash and now we’re on the sidelines, ready to invest when there’s an opportunity.”

All the properties sold by Loja are single-tenant properties. The company is taking the cash earned from the sale to Clarion to reinvest in multi-tenant real estate complexes anchored by grocery stores, where the risk and profits are both potentially higher.

Engberg told Crain’s Business, “The speed with which we redeploy that capital will depend entirely on what happens with pricing. If markets get choppier than they are now, we’ll be hunting for deals in the markets we like, which includes Chicago.”

 


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