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– In column for Real Estate Forum, Joe McKeska of Elkhorn Real Estate Partners cites need
for higher level of analysis in sector disturbed by Amazon and other players.

Shopping center landlords and other investors have long thought of the grocery sector as a “safe harbor” rooted in the reality that “everybody has to eat,” but the time has come to let go of this reassuring conception, writes Joe McKeska, President of Elkhorn Real Estate Partners, in the July/August issue of Real Estate Forum magazine.

“For anyone who invests in grocery-anchored real estate—whether a publicly traded shopping center REIT, private development companies, or your local neurologist and a few of his tennis buddies—it is important to recognize that the calculus required to maximize returns and minimize risk has changed dramatically from the simpler times that prevailed in preceding decades,” McKeska writes.

The 25-year grocery veteran headed real estate operations for Southeastern Grocers, LLC and Supervalu, Inc. prior to forming Elkhorn. A division of Melville, N.Y.-based real estate firm A&G Realty Partners, Elkhorn focuses on helping retailers and investors maximize their real estate portfolio performance in alignment with their broader business strategies.

In the Investors Corner column (“Grocery: A ‘Safe Harbor’ No More”), McKeska cites Amazon’s $13.7 billion acquisition of Whole Foods as well as the accelerating consolidation and general disruption that has marked grocery for the past few years.

To adapt, he cautions, developers and investors need to be more thoughtful and analytical about the types and nature of the grocery stores in their portfolios. “If picking winners in this sector used to be relatively easy—by, for example, closely watching financial strength and performance and new store growth and merger and acquisition trends—those days are gone,” McKeska writes.

In particular, he advises, investors should pay close attention to the ways in which different chains respond to these pressures. Importantly, many of the large, publicly traded chains in the United States are not spending less capital overall—they are simply spending less on net new store growth and focusing more on things such as cultivating ecommerce and digital capabilities or remodeling existing stores.

Longer term, the grocery-anchored sector is likely to confront many other changes, including so-called voice-activated and push-button retail; the rise of services such as Instacart or Blue Apron; and the continued proliferation of specialty channels, including hard discount, ethnic, and natural/organic, the advisor notes in the column.

“To keep pace with these tumultuous times, it is important for developers and investors to understand the market at multiple levels—macro, micro and everything in between,” McKeska writes. “They need to ramp up their overall level of analysis to make the right decisions about whether to buy, sell or hold.”

The goal should be to develop an integrated, data-driven pathway toward maximizing the value of all real estate assets and leases in the portfolio, he counsels, adding that strategic portfolio reviews need to happen much more frequently. “Armed with deeper insights from the use of ‘big data,’ forward-thinking developers and investors can have more confidence as they seek to determine when and how to respond to the rapid changes taking place,” he concludes. “This entails marrying well defined strategy with grocery market and trade area dynamics and the possibilities and limitations that exist relative to any individual real estate asset, whether involving value-add, redevelopment, acquisition, or disposition opportunities.”

To read the full article, go to:


Press Contacts: At Parness & Associates Public Relations, Bill Parness, (732) 290-0121, or Lisa Kreda,


-Newly launched Elkhorn Real Estate Partners takes a holistic approach to helping grocers, other retailers and investors maximize the value of their real estate portfolios.

OAK BROOK, Ill. AND MELVILLE, N.Y. (3/1/17) – A&G Realty Partners today announced the launch of a joint venture with Joe McKeska, a 25-year veteran of the grocery business who previously headed the real estate operations of Southeastern Grocers, LLC and Supervalu, Inc.

The new Oak Brook-based venture—Elkhorn Real Estate Partners–offers grocers, retailers of all types and investors an integrated, data-driven pathway toward maximizing the value of their real estate assets, said Andrew Graiser, Co-President of A&G Realty, a Melville, N.Y.-based real estate firm with offices in Chicago, Los Angeles and Philadelphia.

“Piecemeal approaches to real estate portfolios are simply not enough in today’s environment,” Graiser said. “Elkhorn brings together one of the leading strategic thinkers in the U.S. grocery sector with our nationally recognized capabilities in asset disposition, lease restructuring, valuations, acquisitions, strategic reinvestment, and retail property portfolio optimization. The end result is a truly holistic solution.”

Elkhorn will work to drive asset and portfolio value for retailers and investors in alignment with their broader business strategies via approaches such as:

  • Repositioning assets and portfolios, including identifying opportunities for new or replacement stores, redevelopment of existing stores, and strategic consolidations;
  • Recapitalizing assets in ways that leverage financial markets to increase capital availability;
  • Reinvesting in retail operating and real estate assets to improve performance, including creation of co-investment partnerships between landlords and tenants; and
  • Restructuring real estate assets in alignment with broader market and business plans through lease term, and/or ownership structure modifications and mitigation of surplus properties.

With his extensive background in business strategy, finance, mergers and acquisitions, and real estate operations and development, Elkhorn President McKeska “is ideally suited to guide the strategic efforts of grocers and other retailers,” commented A&G Co-President Emilio Amendola. “Joe has led the real estate strategies of some of the biggest supermarket companies. But his approach is relevant across all categories. It hinges on helping executive teams see beyond individual locations to maximize the strategic value of their overall portfolios.”

The new joint venture will leverage advanced data and analysis, including unique, location-based modeling and geospatial data. “Working with the best data firms in the business, Elkhorn merges leading-edge research with Joe’s decades of experience in retail strategy and analysis to create unique deliverables for our clients,” Amendola said. “The end result is enormously useful. It connects the dots to ensure that real estate portfolios truly support operational success.”

Over the course of his 25-year career, the Oak Brook-based McKeska has successfully developed, acquired, disposed of and managed over 130 million square feet of real estate and acted as a key leader in mergers and acquisitions valued in excess of $12 billion. Prior to Elkhorn, he served as Senior Vice President of Real Estate for Southeastern Grocers, which operates 750 stores in seven states under the Winn Dixie, Bi-Lo and Harvey’s banners. During his 17-year career with Supervalu, Inc. and predecessor entities, McKeska held top real estate positions, including Group Vice President of Real Estate. During his tenure, the $35 billion company maintained operations in 42 states, with 1,500 company-operated stores, 940 licensed stores and 2,700 independent stores serviced by its wholesale business.

According to McKeska, the challenges in today’s marketplace are such that retailers need to be both proactive and strategic about their real estate. He cites the recent chainwide shutdowns at Limited Stores and Sports Authority, and multiple store closures at Sears/Kmart and Macy’s, to name a few. In the grocery sector, meanwhile, new entrants such as Amazon Fresh, Lidl and a raft of specialty chains continue to ramp up the already intense competition, McKeska added. “With respect to real estate, the founders of Elkhorn are of one mind,” he said. “We understand that in today’s environment a strong retail business starts with a healthy real estate portfolio.”

A&G Realty was founded in 2012 by Graiser and Amendola, who have more than 50 years of combined experience in commercial real estate. While best known for its work with healthy and distressed companies in the retail sector, the firm broadened its scope in recent years to handle the disposition of warehouses/distribution centers, single and multi-family homes, and the sprawling campuses of for-profit and non-profit universities. Clients in the retail sector have included Sports Authority, Office Depot, CVS, Supervalu, The Great Atlantic & Pacific Tea Co., Pier1 Imports, Radio Shack, bebe, Aerosoles, and Ascena Retail Group.