11North Partners Buys $108.7M Arizona Grocery Portfolio From A&C Properties Inc.; JLL Arranges $66.36M Loan
PHOENIX — 11North Partners has acquired a seven-property, 422,949-square-foot grocery-anchored retail portfolio across Phoenix and Tucson, Arizona, from A&C Properties Inc. for $108.7 million, JLL Capital Markets announced Nov. 5, 2026. JLL represented the seller and also arranged $66.36 million in acquisition financing for the buyer through an insurance company.
The deal, referred to as the Arizona Grocery Portfolio, is 11North Partners' first investment in Arizona and expands its necessity-based retail platform into its eighth state.
Deal Terms and Financing
The $108.7 million purchase price equates to roughly $257 per square foot across the 422,949-square-foot portfolio. The $66.36 million in acquisition financing represents approximately 61% of the purchase price, leaving roughly $42.34 million in equity and other capital before closing costs and fees.
JLL Capital Markets' Investment Sales and Advisory team represented A&C Properties Inc. The firm's Debt Advisory team, working on behalf of 11North Partners, arranged the financing through the insurance company lender. The Investment Sales and Advisory team was led by Managing Director Patrick Dempsey, Director Tess Berghoff and Analyst Ross Jorgensen. The Debt Advisory team was led by Director Jarrod Howard.
Portfolio Profile
The seven properties are located in multiple submarkets across the Phoenix and Tucson metropolitan areas and sit along high-traffic corridors. The portfolio is 96% occupied, which implies roughly 16,918 square feet of vacant space. It is anchored by Fry's Food & Drug, a Kroger Co. (NYSE: KR) banner, and includes a mix of daily-needs and necessity-based retailers serving each community.
JLL said the properties benefit from limited retail supply in their surrounding trade areas and carry below-market rents. The firm identified tenant curation, lease renewals and mark-to-market adjustments as value-creation opportunities for the new owner.
"A&C Properties Inc. assembled a high-quality grocery-anchored portfolio positioned in submarkets with limited retail supply and strong traffic patterns," Dempsey said. "11North Partners recognized the long-term value in these well-located assets and the opportunity to enhance returns through thoughtful leasing strategies and mark-to-market adjustments."
Phoenix and Tucson Retail Market Context
Phoenix retail fundamentals remain tight. One 2026 market analysis cited a 4.5% vacancy rate, 9.4% year-over-year rent growth and average rents of $1.78 per square foot per month. The same analysis reported cap rates widening from 6.1% to 6.5%, reflecting higher financing costs. A separate 2026 market report put average Phoenix retail sales pricing at about $263 per square foot and the average market cap rate at 7.0%, placing the portfolio's implied pricing of $257 per square foot close to the market average.
In Tucson, Cushman & Wakefield reported that average property values rose approximately 8% year to date through the third quarter of 2026, while cap rates compressed to roughly 7.6% from 7.9% at year-end 2025.
JLL said the Phoenix and Tucson markets continue to attract retail investment capital due to population growth, favorable business climates and strong consumer spending patterns.
About the Parties
11North Partners is a real estate investment firm focused on building a retail portfolio diversified across markets and product types, with activity spanning real estate ownership, debt and operating company investment. A&C Properties Inc. is a private company that operates commercial and retail properties in Arizona and Las Vegas. JLL (NYSE: JLL) is a commercial real estate services and investment management company with annual revenue of $26.1 billion and operations in more than 80 countries.
Outlook
With low vacancy and rising rents in Phoenix, and improving values and tighter cap rates in Tucson, the transaction reflects continued investor interest in grocery-anchored retail in Arizona. For 11North Partners, the portfolio provides exposure to both metropolitan areas through a single acquisition, with leasing and rent-reset strategies identified as the main avenues for enhancing returns.
Sources
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