Oxford Properties Group has entered the U.S. open-air retail sector through the acquisition of two grocery-anchored shopping centres in the Austin, Tex., area via a newly formed joint-venture with Pine Tree.

Toronto-based Oxford and U.S-headquartered Pine Tree acquired Wolf Ranch Town Center in Georgetown, Tex., and Lakeline Plaza in Cedar Park, Tex. The transaction marks Oxford’s first partnership with Pine Tree and its first investment in U.S. open-air retail.

Financial terms were not disclosed, but Commercial Property Executive reported that Oxford and Pine Tree bought the properties from Washington Prime Group for US$250 million.

The one-million-square-foot (msf) portfolio includes two high-performing centres anchored by national retailers such as Target, TJ Maxx, Best Buy and Ulta Beauty. Wolf Ranch and Lakeline Plaza are more than 99% leased and benefit from high traffic driven by their strategic locations in the Austin market.

Austin’s continued population and income growth are supporting consumer spending and reinforcing Oxford’s investment thesis for the assets. Wolf Ranch is a roughly 633,000-sf open-air retail centre located at one of the region’s busiest intersections and attracts more than seven million visitors annually. Lakeline Plaza spans approximately 386,000 sf at a core retail intersection and features a mix of national brands and necessity-based retailers.

By entering the U.S. open-air retail market, Oxford is investing in a sector characterized by limited new supply and resilient performance amid economic headwinds, said the company.

“This acquisition is both a unique opportunity and an exciting milestone for Oxford as we enter the US open-air retail sector alongside a proven best-in-class operator in Pine Tree,” said Ankit Bhatt, Oxford’s head of U.S. investments. “Wolf Ranch and Lakeline Plaza house a diverse mix of resilient and complimentary retailers and embody our ethos of investing in high-quality, well-located assets that deliver both strong cash flow and long-term value. By acquiring these retail centers, Oxford creates a foundation for growth in a new sector, allowing us to leverage our global retail expertise to optimize tenant mix and drive performance.”

The acquisition expands Oxford’s presence in the Austin metropolitan area, where it already owns residential and industrial assets, and builds on its nearly 10-million-sf global retail platform of nearly 10 million square feet, representing approximately $8.8 billion in assets under management. Oxford’s retail properties attract more than 100 million visitors annually and include flagship assets in the Greater Toronto Area that rank among continental and national leaders, according to the International Council of Shopping Centers.

Pine Tree will operate the shopping centres on behalf of the joint-venture, drawing on its 30-year track record of investing in and managing retail assets across the U.S.

“Wolf Ranch and Lakeline represent the type of high-quality, high-growth market retail investments we continue to target nationwide,” said Will Davis, VP, Investments at Pine Tree. “We’re excited to enter the Austin market with Oxford Properties as our partner and look forward to building on this new relationship.”

The Austin Business Journal reports that Washington Prime Group announced earlier this year that it would sell its remaining properties and lay off employees, approximately four years after it filed for Chapter 11 bankruptcy. Washington Prime Group also owns The Arboretum and Gateway Shopping Center in Austin. 

The transaction was brokered by Kyle Minter and Conor Lalor of Newmark.

Oxford is a global real estate investor, developer and manager owned by OMERS. Pine Tree is a Chicago-based retail real estate owner-operator.

With files from Mike Boyd of Connect CRE.