Inland Real Estate Trust buys majority of Marketplace at Tech Center in Newport News
Inland Real Estate Income Trust Inc. announced the acquisition Tuesday of one of Newport News largest and newest shopping destinations. The Oak Brook, Ill.-based company bought 210,000-square-feet of the Marketplace at Tech Center for $72.5 million, calling the grocery-anchored development a “terrific addition” to its retail portfolio.
John Lawson, CEO of W. M. Jordan Co., one of the developers behind the center, said the center’s 250,000-square-foot retail component is part of what is planned as a larger, $450 million, mixed-use development that includes apartments, office and a corporate research park.
“Marketplace at Tech Center is a terrific addition to Inland Income Trust’s retail portfolio because of its exceptional variety of high-caliber grocery, restaurant, clothing and retail offerings,” Mitchell Sabshon, president and CEO of Inland Real Estate Investment Corp., said in a statement. “With its diverse tenant mix, strong demographics and ideal location near major employers, including the Thomas Jefferson National Accelerator Facility, Marketplace at Tech Center is a dominant retail property in the market and is well positioned for future growth.”
Lawson said in an interview with Virginia Business that he and the project’s other developer, Georgia-based S.J. Collins Enterprises, considered several investors to buy the shopping center and thought Inland was the best match. “Neither Collins nor Jordan are property managers, so we knew when we got to the end that we would need property managers to go forward,” said Lawson. Inland stood out, he said, because “they’re large, they’re experienced, and they have other developments in the area. We made it very clear that we wanted the level of quality that we’ve begun to be maintained going forward, we felt like they would do that. What was primary in my mind was someone that would continue our vision.”
Newly constructed in 2015, the shopping center is located on the busy Jefferson Avenue corridor at the corner of Jefferson Avenue and Oyster Point Road. About 172,000 residents live within a five-mile radius. A 39,998-square-foot Whole Foods grocery store opened at the location in November.
In addition to Whole Foods, other tenants include several first-to-the peninsula retailers including DSW Shoe Warehouse, BJ’s Brewhouse and P. F. Chang’s China Bistro.
Lawson made clear that W. M. Jordan will remain as a primary developer and owner for the overall project. The final master plan for the Tech Center includes 250,000 square feet of retail, 288 apartments in 4 buildings, more than 100,000 square foot of office and a corporate research park.
One 25,000-square-foot office building already is under construction, Jordan said. Phase two will include the apartments, a clubhouse and fitness center. “The first occupancy will be in late spring and during all of 2016, we’ll have various buildings turned over,” Lawson said.
Phase 3 is a planned 1.2 million-square-foot corporate research park adjacent to the Thomas Jefferson National Accelerator Facility. Local officials are in hopes that the U.S. Department of Energy will choose the Jefferson lab over a competing lab in New York as the site of an electron ion collider facility, which would bring a second underground facility to the site, but that decision may be one to two years away.
Even if Jefferson Lab doesn’t get the nod, Jordan said he plans to proceed with the corporate research park, if the developers can obtain the necessary land. He said he has signed a letter of intent to buy six of the needed 100 acres from the William & Mary Real Estate Foundation.
A school bus facility owned by the Newport News City Schools sits on a portion of the needed tract.
W. M. Jordan has asked the city to enter into a formal public-private partnership, Lawson said, for the planned research park, but the city has not acted on the issue. He noted, however, that the city has appropriated money in its capital improvements budget to relocate the school bus facility and is seeking bids from companies to do the work. W. M. Jordan and other companies have submitted proposals for the job.
“It the city doesn’t move the bus facility, we don’t have the land, so the corporate research center can’t be built,” he said. If the land becomes available, its ownership could be worked out as part of a public-private partnership. “You can propose to do it on the city’s land … You can slice it and dice it a lot of different ways,” Lawson said.