An international investment firm has entered the Chattanooga market with the first of several proposed acquisitions, purchasing a mall in Lookout Valley for more than $7 million.
Alea Properties, which manages office, medical, retail and industrial properties in half a dozen U.S. states and has foreign interests in Australia and Africa, acquired nearly 10 acres and 49,000 square feet of retail space near the Walmart supermarket on Cummings Highway in Chattanooga.
The mall, which includes a Dollar Tree and 14 other stores, was built in 2005 and was previously owned by Bright-Meyers Lookout Valley Associates, a real estate partnership managed by Fletcher Bright Realtors, according to the Hamilton County Register of Deeds.
Robert Edwards, founder and director of Alea Properties in Franklin, Tennessee, said his firm is looking to buy into the Chattanooga market and expects to make more commercial real estate purchases here in the future. According to Edwards, Chattanooga is the second fastest growing market in the state, and Alea has been looking for the right purchase option for several years.
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“This is the first of several planned acquisitions in this exciting market,” Edwards said in a telephone interview on Tuesday. “This property meets all the criteria in which we want to invest.”
The purchase was funded by First Bank and the sale was completed by Ellen Edwards, the chief acquisitions and leasing officer for Alea, which owns or manages approximately 7.5 million square feet of buildings, Robert Edwards said.
Edwards said he intends to modernize the Lookout Valley property, rent out the remaining 2,800 square feet of vacant space and likely increase rents, which for some tenants have not increased in several years.
The Lookout Valley mall is adjacent to a 203,818 square foot Walmart supermarket that opened in early 2006, just off Interstate 24, which handles an average of 64,258 vehicles per day. The property is near several industrial parks with more than 2 million square feet of industrial space, Edwards said.
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The purchase follows Alea Properties’ acquisition of a similar 126,000-square-foot Kroger-anchored shopping center in Powderly, Kentucky earlier this year.
Alea is the latest outside investment firm to buy a mall in Chattanooga in recent months.
Last month, an Ontario investment firm bought Hixson’s Issa Crossing mall for $10.75 million from Chattanooga developer Bassam Issa, and in May a Las Vegas real estate investment firm paid $16.7 million to purchase the Towne Center North mall, also located off Highway 153 in Hixson. This 11-acre mall was originally developed in 2006 by Chattanooga-based Wolford Development.