Dealmaker: Regency Centers Acquires The Pruneyard Shopping Center

Regency Centers Corp. acquired 258,000 square feet of Silicon Valley retail space within The Pruneyard mixed-use project for $212.5 million.

The Jacksonville, Fla. real estate investment trust purchased The Pruneyard Shopping Center from an Ellis Partners-Fortress Investment Group joint venture. Ellis Partners, San Francisco, retained a minority interest in the new ownership and will continue to operate the property.

An HFF investment sales team led by Managing Director Bryan Ley and Senior Director Eric Kathrein represented Ellis Partners and Fortress Investment Group in the transaction.

Built in the 1960s, The Pruneyard recently completed a substantial renovation. Anchored by Trader Joe’s, it occupies the Campbell Avenue-Bascom Avenue intersection adjacent to State Route 17. In addition to the retail portion, the Pruneyard includes three office towers totaling 360,000 square feet and the 171-key DoubleTree by Hilton Hotel Campbell that were not part of the transaction.

Ellis Partners sold the hotel for $59 million in March. Somera Capital Management, Santa Barbara, Calif., and Tyler Development Corp., Los Angeles, purchased the asset and Sonnenblick-Eichner placed the $36 million acquisition loan with a life company.

Regency now owns and operates 28 Bay Area properties including The Pruneyard.