The recent sale of the Golden Acres Shopping Center in South Plainfield reflects how investors continue to find value in grocery-anchored retail despite a waning consumer market.
A report in NJBIZ from late July said that Agus and Treeco paid $40 million for the 219,848-square-foot retail center at 3600 Park Avenue. A Shop-Rite anchors the property and, according to brokers working on behalf of JLL, the firm that represented the seller in the transaction, was 83% leased at the time of the sale.
Michael Polimeni, the CEO of Garden City-based real estate investment firm Polimeni International, signed off on the transaction, which closed in mid-July, according to records made public by the Middlesex County Clerk’s Office.
Brokers working with JLL mentioned that 3.3 million people visit the shopping center on an annual basis. Several retailers have had a long tenure at the strip mall and are paying significantly below average market rents. This combination, they said, coupled with the demographics of South Plainfield and its vicinity, provided an attractive investment opportunity for Agus and Treeco, despite the broader trends in the retail market.
Despite falling consumer spending and a weakening job market, investors have remained confident that power centers such as Golden Acres, can succeed in prominent areas and regions with affluent demographics. This trend runs largely counter to broader trends in the market as retail and both large chains and small businesses have continued to struggle post-COVID.
Just three miles north of the South Plainfield shopping center, the Inman Grove Shopping Center in Edison also recently sold for $24 million. Despite its relatively smaller size at 120,000 square feet and missing a major anchor tenant since Stop & Shop vacated a 47,000-square-foot pad in 2024, the property fetched a higher price per square foot ($200) than Golden Acres ($182).
That difference in price per square foot is determined by a myriad of factors, some of which are hard to quantify. However, key factors that tend to drive asking prices for commercial properties include demographics, visibility, and the value of the land itself.
C.J. Huter, a VP at The Goldstein Group, the firm that sold the Inman Grove shopping center in May, told Jersey Digs that Stop & Shop has continued to pay below market rent since leaving in November and that they will continue paying rent until next year.
Negotiations with grocery and non-grocery tenants are ongoing, he said, but the arrangement with Stop & Shop will give the new owners a buffer for securing a new anchor tenant. That potential for a new anchor tenant, which may end up paying higher rents than both Stop & Shop and Shop-Rite at Golden Acres, is also reflected in the difference in price per square foot.
“The bigger investors want grocery-anchored shopping centers,” Huter said. “They don’t want to deal with [mid-size stores], they want to deal with grocery stores, especially in a neighborhood market. Groceries will always be needed, there will always be people eating and buying food.”
Huter added that Inman has had a historical occupancy of over 90% and that the new owner of the property is a local investor, which also played a factor in the final price per square foot for the sale.
