Bain Capital Real Estate and 11North Partners have teamed up to acquire and manage open-air retail centres in the US and Canada.
The companies said the partnership will target a wide range of investment opportunities across different risk and return profiles and will mainly focus on shopping centres with a high concentration of stores selling everyday essentials.
Brian Harper, 11North’s founder and CEO, said: “Today, open-air retail centres benefit from a confluence of tailwinds and strong real estate fundamentals that create an attractive risk-return opportunity.
“We believe historically low supply growth and increased demand for open-air shopping centres, driven by strong retail sales, persistent work-from-home trends, and the increased prevalence for omnichannel shopping, provide a favourable backdrop for the sector.”
Harper added that with 11North’s “demonstrated history of generating strong returns and a lack of challenged legacy assets, our focus will remain on offense in what we believe will be a compelling investment environment”.
Ryan Cotton, the head of Bain Capital Real Estate, said: “Through significant transformation over the last 15 years, including the great financial crisis, an ongoing ecommerce transition, the D2C [direct-to-customer] insurgence, and a global pandemic, the way we shop continues to evolve.
“We believe there are clear, emerging thematics that support the winning brands, retailers, and commercial real estate of tomorrow. In convenience-oriented, necessity-based retail, we see a format that is well aligned with these themes, will continue to enjoy strong operating performance, and delivers strong results to tenants.
“But, the market has yet to fully appreciate the bifurcation of the retail sector, which we believe leads to the opportunity for highly attractive risk-adjusted buying.”
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