The Shops at Fort Union, a 59-acre shopping center near the center of Midvale’s commercial district, has been sold from one out-of-state developer to another for $142 million.
Built in 1989, the shopping center has nearly 70 tenants on a slice-of-pie-shaped parcel along the curving south side of Fort Union Boulevard (7200 South) just east of 900 East.
Those tenants include a big-box store (Walmart), an anchor grocery store (Smith’s), national retailers (Bed, Bath & Beyond, Dick’s, DSW and Ross) and small, local shops (Sweet Tooth Fairy and Waffle Love right by Midvale Modern Dentist). Cumulatively, the stores occupy nearly 700,000 square feet of commercial space.
Mountain West Commercial Real Estate helped negotiate the sale from Chicago-based Blackstone-ShopCore to CCA Acquisition Co., an affiliate of Kornwasser Shopping Center Properties. An internet search showed Kornwasser has offices in Los Angeles and Phoenix.
“CCA will continue its proven business plan of working with tenants and the community to increase value by responding to market-driven demand,” said Mountain West’s Ben Brown, who hammered out the transaction with Blackstone-ShopCore representative Pete Bethea, executive managing director of NKF Capital Markets.
Brown said the new owners planned to transform “the property into a place to spend time in addition to a place to shop.”
Midvale spokeswoman Laura Magness said city officials had a good working relationship with the shopping center’s former owners and were eager to get to know the Kornwasser team. “We’re looking forward to having new owners and the energy they will bring,” she added.
Kornwasser President Steven Usdan said the Fort Union center was attractive because of its location, within 20 minutes of the airport, downtown and the four Cottonwood Canyons ski resorts. He also cited the demographics of the midvalley site, with its strong retail sales and limited competition.
The company has more than two dozen shopping centers in Arizona, California, Idaho, Washington and Oregon, as well as a share in University Crossing Shopping Center in Orem. Usdan said Kornwasser also recently developed Oquirrh Mountain Marketplace, an 18-acre shopping center in South Jordan that has a Sprouts store as its anchor tenant.
“Our business plan for Fort Union,” Usdan added, “contemplates upgrading facades and outdoor areas as well as improving traffic flow, pedestrian connectivity and lighting.”
The company was founded in 1989 by Joseph Kornwasser, who previously was a senior executive at Kimco Realty Corp., a real-estate investment trust that has been one of the country’s largest managers of open-air shopping centers.
This is the second commercial property in Utah that has been sold in the past six months by ShopCore, an affiliate of The Blackstone Group, one of the world’s largest real-estate owners and managers with 24 million square feet of commercial space under its control.
In October, Blackstone-ShopCore sold Red Rock Commons, a 134,000-square-foot retail center in St. George, for $33.2 million. It was purchased by Pacific Castle of Irvine, Calif.
Brown said the sale of The Shops at Fort Union reflects the presence of Utah’s strong commercial retail market, which could see Mountain West Commercial Real Estate ring up sales of more than $600 million this year.