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Burnham Pacific Properties Buys 20 Shopping Centers


Burnham Pacific Properties Inc., a San Diego-based real estate investment trust, on Monday purchased 20 community shopping centers across California for $302.4 million, making the firm one of the state's largest owners and managers of retail space.

The deal also makes Burnham Pacific the largest publicly traded West Coast retail REIT and could help the firm attract the backing of larger institutional investors, according to Eric Lohmeier, who follows retail REITs for Everen Securities. As a result of the deal, which was announced in November, Burnham Pacific owns interests in 61 retail properties with more than 8 million square feet of space.

"It's going to be a big deal for them," Lohmeier said.

Burnham Pacific acquired the 2.6-million-square-foot portfolio of shopping centers from Golden State Properties, which is a partnership between El Segundo-based Highridge Partners and the Blackacre Capital Group, which is a New York-based real estate investment fund. As part of the deal, affiliates of Blackacre and Westbrook Partners, a real estate investment management firm, purchased $120 million in new convertible preferred securities issued by Burnham Pacific. The securities can be exchanged for Burnham Pacific common stock at $15.38 a share.

On Monday, Burnham Pacific shares on the New York Stock Exchange fell 13 cents to $15.38.

The properties Burnham Pacific has purchased are community shopping centers anchored primarily by large supermarkets or drug stores. The shopping centers are spread across the state and include Centerwood Plaza in Bellflower, Ralphs Center in Redondo Beach, Bell Gardens Marketplace in Bell Gardens, Westminster Center in Westminster and Buena Vista Shopping Center in Duarte.

Burnham Pacific will continue to look at more acquisitions as the California economy continues to improve and real estate values keep rising, said chief financial officer Daniel B. Platt.

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