Shopping Center Business is the leading monthly business magazine for the retail real estate industry.
Issue link: http://shoppingcenterbusiness.epubxp.com/i/817746
ECHO REALTY 188 • SHOPPING CENTER BUSINESS • May 2017 mature yields superior investment results verses what an investor would receive if they simply bought core assets." All of the centers that ECHO has ac- quired follow a theme of having the dom- inant grocer in the area with considerable term left on the lease. The properties are also well located and have tenants that are service oriented. In ECHO's portfo- lio, the net operating income solely from grocery stores is about 75 percent of the NOI of the total portfolio. That makes the company unique in its class. "In addition to the grocery, we look for tenants who will not be affected by the internet in the future," says Gorman. "We want to populate our centers with uses that involve food, beauty, entertainment, destination retail or services, and fitness." "We see lots of disruption headed for retail. We want to be positioned in such a way that disruption has a minimal impact on us," adds Karet. ECHO's recent targeted asset alloca- tion has been heavier on core properties, with smaller allocation to value-add, de- velopment and core-plus properties. Notwithstanding this, ECHO has also developed several ground-up centers over the past several years. For example, in Hyattsville, Maryland, near the Uni- versity of Maryland the company built a mixed-use project on 3.5 acres, anchored by a 54,000-square-foot Safeway store. A MedStar clinic is located above the gro- cery store. About 10,000 square feet of additional retail space is positioned along the streetfront, with some complementa- ry retail space on the second level. TENANT REPRESENTATION In addition to growing its diversifica- tion as an owner and developer, ECHO has also continued to expand its retail tenant representation and third party leasing business, ECHO Retail. Based at its Pittsburgh headquarters with a satel- lite office in Indianapolis, ECHO Retail is headed by senior vice president Aaron Savin. While guiding ECHO's leasing group and participating in the creation and execution of ECHO Realty's strategic plan, Savin has also built ECHO Retail to currently represent over 75 retailers oper- ating as far west as Kansas and all along the Eastern Seaboard in various capaci- ties, either locally or on a multi-state basis. The company represents tenants includ- ing Dick's Sporting Goods, Gabe's, Of- fice Depot, Starbucks, McAlister's Deli, Panda Express, Michaels, TJX, Petsmart and Five Below. ECHO Retail's "reach" continues to grow and provide synergies with ECHO Realty. As an example, ECHO capitalizes on its strong leasing platform with the abil- ity to offer merchandising and leasing ser- vices to outside owners and developers in ECHO's local markets. ECHO provides leasing services to major shopping center owners such as Kimco Realty, whose Pitts- burgh area centers it has leased for many years, and to smaller regional developers such as AdVenture Development, whose 250,000 square foot McCandless Cross- ing development ECHO merchandised and leased from the ground up. ECHO's strong relationships have also introduced the company to a number of properties that were not widely marketed that the company was later able to acquire. Those relationships have led to the company acquiring a number of one-off acquisitions from entities that held a sin- gle property, as well as acquiring a port- folio of multiple centers. In some cases, ECHO did not require the services of an intermediary broker, which has been at- tractive to some sellers seeking to maxi- mize their returns. Since SCB last visited with ECHO management four years ago the company has very successfully begun diversifying its asset base while remaining narrowly focused on best-in-class grocery anchors with complementary necessity based re- tail uses. SCB Gateway at UTC is an 83,000-square-foot Safeway-anchored center that ECHO developed in Hyattsville, Maryland.