Federal Realty Pays $215M for NoVa Retail Center

Federal Realty Investment Trust is acquiring the Virginia Gateway retail center in Gainesville, Va., for $215 million. The seller is Crow Holdings, a Federal Realty spokesperson told Commercial Property Executive.

With demographic depth and wealth surrounding the property in Prince William County, this oversized 110-acre hub at approximately 665,000-square-foot is considered irreplaceable regionally.

Virginia Gateway is approximately 95 percent occupied and features strong tenant sales and high traffic counts in an affluent and growing market.

Jeff Brown, founder & CEO of T2 Capital Management, tells CPE that a purchase at this scale further helps to provide solid footing within the commercial real estate market at large.

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“Although distressed situations—primarily in the office market—currently dominate headlines, it is well-located, prudently leveraged assets like Virginia Gateway that are quietly underpinning growth and a healthy transaction volume,” Brown said. “It is reasonable to anticipate other grocery-anchored retail centers like this will continue to thrive.”

Affluent customers, strong sales

Located just west of Loudoun County and about 35 miles from Washington, D.C., Gainesville’s growing population is supported by an influx of higher-paying jobs. The average household income within a 3-mile radius of the property exceeds $184,000, surpassing the company’s in-place portfolio average, according to a release.

Additionally, Virginia Gateway has convenient access to the Dulles Technology Corridor, known for its concentration on defense contracting and tech jobs. It sits at the intersection of Route 29 and I-66.

In 2023, the property ranked No. 3 in the state for annual visits, according to Placer.ai, just behind Tysons Corner.

FRIT said the center’s tenant sales are strong across categories, particularly in food and beverage.

Virginia Gateway features a mix of tenants and experiences organized into five components, including a Giant Food grocery-anchored shopping center; the Promenade featuring national specialty retailers and dining options; a pedestrian-oriented Atlas Walk town center; Plaza I & II featuring major retailers like HomeGoods and Ulta Beauty; and Plaza IV, anchored by Total Wine & More and Hobby Lobby.

The property benefits from shadow-anchors such as Lowe’s, BJ’s Wholesale Club and Super Target.

Virginia Gateway has approximately 300,000 square feet of small shop space, which is expected to drive future growth.

Federal Realty is a leading owner, operator and redevelopment firm of high-quality retail-based properties located in major coastal markets from Washington, D.C., to Boston, San Francisco and Los Angeles.