AURORA -- Headwater Capital, a private equity firm specializing in long-term, secure cash flow from commercial real estate, has announced the $13.1 million acquisition of Barrington Town Center. The firm secured $5 million from investors and arranged financing for the balance of the purchase price.
"The Barrington property is one of the most compelling commercial real estate investments we have experienced," said Headwater Capital co-founder and CEO Robert A. Kantor. "Barrington exemplifies a commercial investment opportunity with outstanding fundamentals -- superior demographics and an intrinsic value in excess of the acquisition price.
"Barrington is projected to provide our investors with an average cash flow exceeding 9 percent per year over 10 years, with an IRR of 12 to 14 percent."
The 112,631-square-foot Barrington Town Center, built between 1996 and 2004 by DDR Corp., is the dominant retail center in the heart of affluent, upscale (average household income exceeds $130,000) Aurora.
The 97 percent occupied property includes businesses such as the 10-screen Cinemark theater, University Hospital's Aurora branch, Howard Hanna, Dollar Tree, Great Clips, Pizza Hut, the UPS Store, Subway, GNC and Doogan's.
The Heinen's Supermarket, Huntington Bank building, CVS/Pharmacy, Wendy's, Dunkin' Donuts and Walgreens are not part of the sale.
"I am hopeful that the new owner of Barrington Town Square will be committed to the high quality of tenants in the plaza, and that the cinema will remain as an important entertainment venue in Aurora," said Mayor Ann Womer Benjamin.
"In addition, we're looking forward to a new tenant for the former Starbucks location since speculation abounds and we get many questions on the topic."
The retail center is surrounded by Barrington Golf Club, featuring a Jack Nicklaus Signature golf course, and the Barrington Estates residential community.
Headwater Capital teamed with Beachwood-based Guggenheim Commercial Real Estate Group, a full-service real estate firm with more than 60 years of servicing clients throughout Northeast Ohio. Guggenheim will provide onsite commercial property management and leasing services, supporting Headwater's local collaboration policy to maximize asset management.
The Cooper Commercial Investment Group arranged the sale, with Dan Cooper representing the institutional seller and securing the buyer.
In August 2016, Headwater Capital closed a $3.5 million investment at Olio Pavilion LLC, a grocery-anchored retail property in Fishers, Ind.
Kantor and his team are leveraging four decades of CRE investing success, having acquired and managed investments in excess of $800 million.