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EDENS’ Coast-to-Coast Expansion: Interview with Jodie W. McLean

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As published in Bisnow Southern California, April 12, 2022 // EDENS Kicks Off West Coast Expansion With 8 Grocery-Anchored Retail Centers, written by Bianca Barragan

With the purchase of eight grocery-anchored retail centers in Seattle, Northern California and Southern California, Washington, D.C.-based retail owner, operator and developer EDENS is heading west.

On its native East Coast, EDENS is focused on lifestyle-oriented retail centers, including Washington, D.C.’s Union Market and the pending overhaul of an underutilized mall in Georgia’s DeKalb County. EDENS CEO Jodie McLean told Bisnow the properties that constitute the company’s West Coast foray — one that may not be done yet — make sense as well-located sites where EDENS’ community-focused approach can flourish, touching on grocery-anchored retail hubs’ popularity over the last year and the strength of suburban retail’s rebound.

“If you look at the tenancy and their placement — embedded in neighborhoods — the bones of these assets are fantastic,” McLean said, adding that “some of [the properties] probably have an opportunity for us to expand the ability to drive those human interactions.”

While it is still too early to say what additions or changes might come to the centers to achieve those goals, McLean said the company likes to have gathering spaces at its properties, and some of the new West Coast properties could get additions aimed at creating that on-site.

McLean said she anticipates that the company’s focus on placemaking — on display at its D.C. Union Market project or in Denver at RiNo – 27th and Larimer — will shape whatever changes it ultimately decides on.

Taking what are really traditional and wonderful assets and making sure that they’re the hub of every one of their communities will be the focus moving forward.

Jodie W. McLean CEO, EDENS
jodie

The eight West Coast properties that EDENS purchased were Callens Corner in Orange County’s Fountain Valley; the Bonita Centre in San Diego County, adjacent to Chula Vista; the Alamo Plaza Shopping Center, 30 miles outside of San Francisco in Danville; Gilman District in Berkeley; Rocklin Commons, about 20 miles outside of Sacramento; the Village Oaks in San Jose; and the Lakeland Town Center and Westgate North Shopping Center, both in the Seattle area. All are grocery-anchored and have an average occupancy of 95%, McLean said. Especially in Southern California, the properties EDENS acquired are firmly suburban. Shopping center foot traffic for 2021 rose 32.2% from 2020 but still remains below 2019 levels, according to a Q4 2021 JLL retail outlook report. Suburban shopping centers have seen a faster recovery than urban retail, with the former down just 2.2% from 2019 foot traffic totals while the latter remains 24.6% below 2019 figures.

Despite shoppers returning to suburban retail at a faster clip than its urban counterpart, McLean said urban retail could very well be a part of later stages of EDENS’ West Coast expansion.

“We are a big believer that that urban core will come back,” she said.

McLean said she views the acquisitions as the continuation of a westward push that started in Texas in 2015, then moved to Denver in 2018. But the westward expansion stalled amid the coronavirus pandemic. When the opportunity arose to keep moving the wagons west, EDENS seized it.

“It gave us an opportunity to enter the West Coast with a sizable operation rather than a one-off,” McLean said.

All the shopping centers that EDENS acquired in California and the Pacific Northwest were sold by Donahue Schriber Realty Group, a Costa Mesa-based private REIT focused on shopping centers. A purchase price wasn’t disclosed, and EDENS declined to share one. Bethesda, Maryland-based First Washington Realty announced last week that it had acquired Donahue Schriber.

Grocery-anchored retail centers like the ones EDENS acquired have emerged as desirable assets. The property type accounted for the largest share of retail property acquisitions in 2021, accounting for $13.3B in transaction volume, according to a JLL report published in late March. ShopOne Centers, a REIT focused on grocery-anchored retail in the U.S., announced in March that it formed a joint venture with investment manager Pantheon Ventures and an unnamed institutional investor to spend $1B on grocery-anchored shopping centers.

The overall retail market seemed to be in a good place to support an expansion of the company, too, McLean said, brushing off the idea of e-commerce as a retail killer and calling that shopping medium “a partner rather than a foe.”

Communities want to be back with each other. The store plays a really important role both in a community and bringing people together as much as it does driving all the channels of retail.

Jodie W. McLean CEO, EDENS

While McLean shared no specific plans for further EDENS expansion, she said that the company is already thinking ahead, possibly to Phoenix or Portland, for other opportunities.

“There’s no question that we’re trying to build a platform that can scale and grow,” McLean said.