ArrowMark Partners Lends $35M for Regal-Anchored Virginia Retail Center

Developers Realty Corporation has sealed a $35.3 million loan to refinance a retail property in Williamsburg, Va., anchored by the Regal New Town movie theaters, Commercial Observer has learned.

ArrowMark Partners supplied the bridge loan for the developer’s New Town Shops on Main property that opened in 2007. The deal will retire a previous loan provided by Canadian nonbank lender Romspen in August 2022, and also fund the majority of Regal’s planned $4 million renovation of its 12-screen theater complex at the retail center.

Colliers arranged the transaction with a team led by Dylan Kane and Zach Redding, managing directors of the brokerage firm’s New York capital markets group.  

Kane said a portion of the proceeds from the refinancing will be dedicated toward the Regal renovations and rollover expenses for other tenants throughout the 248,000-square shopping center. The movie theater renovation project is commencing after Regal New Town signed a long-term lease through July 2036 following a corporate restructuring of its parent company after the 2022 refi, which was also facilitated by Colliers. 

“The major objective of this deal is to allow them to repay their old lender and reduce their cost of capital,” Kane told CO. “The retail environment in general right now is a lot better than it was in 2022 so the interest rate is about 200 basis points lower than the last deal, and they have extra dollars to pay for the renovations.”

Located a few minutes from Colonial Williamsburg and The College of William & Mary, New Town Shops has increased its leasing occupancy to 91 percent from 85 percent in 2022 during the last refi for the property, according to Colliers. It is the centerpiece of a 365-acre master-planned New Town community comprising  homes, office buildings, restaurants and retail properties. 

Other tenants at New Town Shops include Planet Fitness, Joann and Barnes & Noble. Kane noted that the property is located at the intersection of Monticello Avenue and Ironbound Road, a high-traffic corridor that draws roughly 39,000 vehicles per day on the two thoroughfares. 

Rob Brown, portfolio manager and head of real estate at ArrowMark Partners, said Regal’s lease extension was executed as part of the refi.

“Regal wanted the landlord to fund some of the costs for the renovations and provided them that as part of the structure,” Brown said.

Officials at Developers Realty Corporation did not immediately return a request for comment.

Andrew Coen can be reached at acoen@commercialobserver.com