Urban Edge Properties adds Ledgewood Commons for $83M

New York REIT Urban Edge Properties added two New Jersey shopping centers to its portfolio in the first quarter of 2024, including The Shops at Ledgewood Commons in Roxbury.

The company acquired the 448,000-square-foot grocery-anchored property in Morris County for $83 million. Located at the junction of Routes 46 and 10, the community center recorded more than 369,000 visits in April 2024, according to Placer.ai data .

Earlier in the year, Urban Edge also paid $34 million to add Heritage Square, an unencumbered 87,000-square-foot retail center in Watchung . Urban Edge Properties highlighted the purchases, along with two dispositions, in itsQ1 results released May 7.

In an accompanying statement, chairman and CEO Jeff Olson described the start to the year as "excellent."

"[W]e acquired two shopping centers in New Jersey ... strengthening our presence in this core market and providing attractive growth and redevelopment opportunities," Olson said. "These acquisitions, totaling $117 million at an approximate capitalization rate of 8%, were financed through a combination of 6.1% mortgage debt, asset sales at a blend 5% cap rate and equity issued under our ATM program."

The Ledgewood Commons deal closed April 5. The tenant mix at the recently redeveloped center includes Walmart Supercenter, Marshalls, Burlington, Ulta, Starbucks and Chipotle. Earlier this year, Barnes & Noble joined the lineup .

Primed for future growth, the company identified two pre-approved and undeveloped outparcels covering a total 20,000 square feet at the property. There is also the opportunity for lease up, with a small number of vacancies available, according to Urban Edge Properties.

Last week, a new, five-year $50 million mortgage loan, was sourced with a fixed interest rate of 6.03%. Urban Edge Properties said it expects first-year cash yield on Ledgewood Commons to exceed 10%.

Sales

The company also offloaded properties in Hazlet and Lodi.

At the former locale, a 95,000-square-foot property sold for $8.7 million, according to Urban Edge Properties.

In Bergen County, the company closed the sale of a converted property to its tenant, AAA Wholesale, for $29.2 million . Urban Edge Properties put the cap rate at 5.4% for that deal. The transaction was part of a 1031 exchange with the acquisition for Heritage Square. According to the company, that allows for the deferral of capital gains resulting form the sale for income tax purposes.

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