It took more than nine months, but Simon Property Group last week announced that it has completed its $2.3 billion transaction with Prime Outlets Acquisition Co. and certain of its affiliated entities to acquire 21 outlet centers.
The deal was initially announced last December. Simon has signed a proposed consent agreement with the staff of the Federal Trade Commission in connection with the deal.
Simon previously announced that it had amended its agreement so that the owners of Prime will retain Prime Outlets-Saint Augustine as well as the Livermore and Grand Prairie development projects. The completed transaction includes the assumption of approximately $1.55 billion of Prime's existing indebtedness and preferred stock. Simon paid equity consideration to Prime's owners, generally comprised of 80 percent cash and 20 percent in SPG common operating partnership units.
Simon Chairman and CEO David Simon said in a statement, “The Prime Outlets portfolio is an excellent strategic fit and presents a compelling opportunity for Simon to benefit from shoppers' increased demand for discounted brand-name merchandise. We believe that our strong track record of operational excellence, financial resources, and history of successful acquisitions, make us well positioned to improve the performance of these assets for the benefit of tenants, retailers and consumers."
Simon was advised in this transaction by UBS Investment Bank and J.P. Morgan Securities Inc.
Glimcher and Blackstone Confirm Hawaii Deal
Glimcher Realty Trust confirmed that it entered into an agreement along with an affiliate of Blackstone Real Estate Advisors to purchase Pearlridge Center in Honolulu, Hawaii for $245 million. Word of the deal first came about one month ago.
The transaction is anticipated to close in the fourth quarter of 2010. Pearlridge will be acquired by a joint venture that is owned 80 percent by an affiliate of Blackstone Real Estate Advisors and 20 percent by an affiliate of Glimcher. Glimcher will lease and manage the property.
The purchase price of $245 million will be funded by proceeds from a new mortgage loan of approximately $175 million that will be obtained at closing and equity contributions by the joint venture partners. The equity contributions will be funded proportionately by the joint venture partners based upon their respective ownership interests in the venture. Glimcher will fund its required portion of the equity contribution through available capacity under its line of credit.
The transaction required the venture to post a $10 million earnest money deposit, which is nonrefundable provided certain estoppels and consents are received and certain other customary conditions are satisfied.
Pearlridge is the second largest mall in Hawaii with a total leasable area of over 1.0 million square feet. Pearlridge was built in 1972 and underwent extensive renovations in 1995 and 1996. The property has in-line tenant sales of approximately $500 per square foot and an occupancy rate of 99 percent.
Mid-America Closes on $48.5M Sale of Missouri Property
Mid-America Real Estate Corp.’s investment sales group announced the recent sale of the 340,000-square-foot Manchester Highlands power center in Manchester, Mo. Cole Real Estate Investments purchased the center from Pace Properties for $48.5 million. Mid-America Senior Vice President Ben Wineman represented the seller in the transaction. The buyer was self-represented.
Developed in 2009, Manchester Highlands is anchored by Wal-Mart Supercenter, Best Buy, Bed Bath & Beyond, PetSmart and Ulta, and shadow anchored by a separately owned Costco.
Chevron Taps CBRE for Management Contract
CB Richard Ellis Group Inc. announced that Chevron Corp. renewed its contract for CBRE to provide comprehensive real estate services for Chevron's retail property portfolio. The multi-year contract renewal encompasses transaction, facilities, and project management services for more than 650 retail sites in North America, as well as facilities management at more than 490 sites in the U.S.
Earlier this year CB Richard Ellis was awarded an expanded facilities management role for Chevron's North American retail portfolio and as well as expanded responsibility for divesting Chevron's retail sites in Latin America.
Regency Acquires Chicago Area Center
Regency Centers closed on the $18 million acquisition of the 62,443-square-foot Glen Oak Plaza neighborhood center in Glenview, Ill., from the Adinamis family, a Chicago-area family real estate partnership. Joe Girardi with Mid-America Real Estate Corp. represented Regency in the transaction.
Glen Oak Plaza is a class-A shopping center anchored by an 11,944-square-foot Trader Joe’s specialty grocery store and a 15,754-square-foot Walgreens, along with NorthShore University HealthSystem, FirstMerit Bank, Einstein Bros. Bagels, Starbucks, Boston Market and a variety of retail, restaurants and service businesses. Built in 1967, the center is 97 percent leased.
Franklin Street Closes Two Drugstore Deals
Franklin Street Real Estate Services announced the sale of two Walgreens stores in the Atlanta area, with one store in Lilburn and the other in Douglasville. The two properties closed for $11.2 million, which translates to $395 per square foot on the overall transaction.
The purchaser, a private institutional New York City-based commercial real estate investment group, financed both transactions internally. The seller, a preferred developer for Walgreens based in Atlanta, specializes in development throughout the Southeast.
Sean Attaway Molloy, Senior Director of Franklin Street Real Estate Services, represented the seller in both transactions.
The 13,500-square-foot store in Douglasville opened in 2008. The Lilburn store opened in 2007.
Newmark Merrill Acquires Arvada Marketplace East
NewMark Merrill Mountain States acquired the 164,611-square-foot Arvada Marketplace East shopping center in Arvada, Colo., for $3.35 million.
The acquisition of the property was completed in partnership with a private family investment trust. Arvada Marketplace East was built in 1987 and is home to Floor & Decor, College of International Esthetics and Executive Recycling. The center is adjacent to Arvada Marketplace West and shares a common parking field, representing over 400,000 square feet of retail.
NewMark Merrill Mountain States will re-position the shopping center, which is currently 52 percent vacant. The company intends to upgrade the façade of buildings, add additional signage, and add at least two major anchors.
NewMark Merrill Mountain States was represented by Timothy Richey, executive vice president with Cushman & Wakefield. The center was purchased from CapMark Bank.
Plaza Advisors Announces Two Sales
Plaza Advisors announced the sale of the 99,864-square-foot West Bird Plaza in Miami and the sale of a newly constructed 16,510-square-foot Walgreen’s drugstore in Ocala, Florida.
West Bird Plaza is anchored by Publix and CVS Pharmacy. West Bird Plaza was built in 1977 and was 94 percent leased at the time of sale.
Plaza Advisors represented the seller in the transaction and co-managing partners Anthony Blanco and Jim Michalak, together with senior financial analyst, Lenard Williams were involved in the engagement. The seller and buyer were entities affiliated with Phillips Edison and Co. and Equity One Inc.. The sale price was not disclosed.
On the Walgreen’s deal, Plaza Advisors represented the seller in the transaction. Blanco, Michalak and Williams are involved in the transaction.