Apollo Affiliate Pays $56M For Pembroke Pines Retail Center
Apollo Realty Income Solutions acquired a 135K SF shopping center in Pembroke Pines in another example of Wall Street firms bulking up retail real estate holdings as the sector emerges as one of the most resilient asset classes in South Florida and nationally.
The affiliate of private equity giant Apollo Global Management paid $56M for 16000 Pines Market, which is west of Hollywood in Broward County. Miami-based Terra Group sold the property, a former U.S. Postal Service distribution center that it redeveloped across two phases in 2020 and 2022.
The 13.2-acre development at the intersection of Pines Boulevard and Dykes Road is fully leased, anchored by Publix, and has a mix of retail, restaurants and service providers. Other tenants at the property include Crunch Fitness, Burlington, First Watch Café, Verizon Wireless, Everglades Family Dental, Tropical Smoothie Cafe, Cheddar’s Scratch Kitchen, Jersey Mike’s Subs and MD-Now Urgent Care Center.
“Creating a retail environment that meets the needs of today’s consumers is about much more than simply filling storefronts,” Terra CEO David Martin said in a release. “At 16000 Pines Market, we curated a retail mix driven by restaurants, grocery, and everyday services — tenants that aren’t forced to compete head-to-head with e-commerce when it comes to serving nearby residents.”
Martin said the sale was driven by the diverse tenant mix and strong buyer demand for newly developed retail assets in the neighborhood. A representative from Apollo declined to comment on the purchase.
Terra was represented in the transaction by a Cushman & Wakefield team of Vice Chair Mark Gilbert, leader of the firm’s retail capital markets practice in the Americas, and Executive Director Adam Feinstein.
Terra has built two retail complexes in Pembroke Pines, a suburban community with around 170,000 residents between Fort Lauderdale and Miami. In 2020, the developer also completed the 80-acre master-planned Pines City Center, which includes 300K SF of retail space and 387 garden-style apartments.
Retail properties have emerged as a resilient commercial real estate sector as the broader industry emerges from the pandemic.
Green Street found that the performance of malls has improved year-over-year in its Annual Mall Grade Review, which was released earlier this week. The real estate research firm tracked operations at 1,000 malls across the country and upgraded 145 malls’ performance while downgrading 83 properties.
Vince Tibone, managing director and mall sector head at Green Street, said the positive momentum was “a rarity” in a blog post outlining the report's findings.
Retail space in South Florida has performed especially well. Miami had the fastest-growing rents in the country in the second quarter, as retailers and restaurant owners followed the migration of wealthy consumers from Northern states over the last few years.
The Fort Lauderdale retail market had the third-highest rents in the state behind Miami and Palm Beach at the end of the second quarter, according to a report from Matthews Real Estate Investment Services. The market also saw $1.1B in sales volume over the 12-month period ending in June, exceeding the historical average.
“The rent premium in Fort Lauderdale compared to the U.S. average asking rent has increased from around 22% higher in 2020 to over 38% higher currently,” the report’s authors wrote. “Strip centers, general retail, and other retail subtypes have been driving the rent growth outperformance, with annual rent gains exceeding 24% since 2020.”
