TIAA-CREF and CBL & Associates Properties Inc. have formed a $1.09 billion real estate joint venture to invest in market dominant shopping malls.
TIAA-CREF will invest in four of CBL’s malls: Oak Park Mall in Kansas City, Kan. West County Center in St. Louis, Mo., CoolSprings Galleria in Nashville, Tenn. and Pearland Town Center in Pearland, Texas.
“We have been exploring joint venture opportunities for quite some time and our patience and persistence has been rewarded,” CBL & Associates Properties President and CEO Stephen Lebovitz said in a statement. “We believe TIAA-CREF is the right partner for CBL and together have structured a mutually beneficial venture. We are pleased to recognize the significant enhancement in value for our portfolio through this transaction.”
“This is an attractive opportunity to expand TIAA-CREF’s long-standing footprint in the dominant regional retail sector,” Philip McAndrews, TIAA-CREF managing director and head of global real estate transactions and joint ventures, said in a statement. “The investment underscores our continuing strategy to invest in high-quality, well-leased and well-located retail properties with strong and experienced partners, such as CBL. We believe super regional malls are an essential part of a well-diversified portfolio. These assets provide durable income streams along with stable and enduring long term values.”
The deal will reduce CBL’s total debt by $480 million.
TIAA-CREF will receive a 50 percent pari passu interest in the three enclosed malls, including Oak Park Mall, West County Center, and CoolSprings Galleria and a 12 percent interest in Pearland Town Center. In addition, TIAA will assume approximately $268 million of property specific debt. CBL will continue to manage and lease the properties. CBL anticipates closing on the transaction by third quarter 2011. Eastdil Secured acted as CBL’s exclusive financial advisor in arranging this joint venture.
Macerich Receives $1.5B Credit Line
The Macerich Co. closed on a new $1.5 billion unsecured line of credit facility. Based on the Company's current leverage level, the facility has an interest rate of LIBOR + 2.00 percent. The line of credit has a four year term, extendable to five years, and can be expanded up to a total facility of $2.0 billion.
General Growth Buys Back Shares
General Growth Properties Inc. has purchased for cancellation approximately 30.6 million shares of its common stock at a purchase price of $15.95 per share, investing a total of $487.9 million. The acquisition was completed through private purchases.
The company also announced its intent to repay $339 million of corporate recourse debt prior to June 30, 2011. The debt carries an average interest rate of 5.9 percent and has an average maturity term of 1.8 years. Following the repayment of these facilities, GGP will be debt-free at the parent-company level, with the exception of $206 million of trust-preferred securities due in 2036.
“Since the beginning of 2011, we have generated liquidity in excess of $2 billion from the sale of non-core assets, non-recourse asset financings and a new credit line,” GGP CEO Sandeep Mathrani said in a statement. “ Looking forward, we expect to retire in excess of $2.5 billion of subsidiary and asset level debt by the end of 2013,”
Ramco-Gershenson Closes On Credit Facility; Sells Shopping Center
Ramco-Gershenson Properties Trust has closed on a new $250 million unsecured credit facility arranged by KeyBank Capital Markets. The facility replaces its prior $150 million secured line.
The new facility is comprised of a three-year $175 million revolving line of credit and a four-year $75 million term loan. Subject to customary conditions, both the revolving line and the term loan can be extended for one year at the company’s option. Borrowings under the facility are priced at LIBOR plus 200 to 275 basis points depending on the company’s leverage ratio. In addition to KeyBank, banks participating in the financing are JPMorgan Chase Bank, Bank of America, Deutsche Bank Trust Co. Americas, PNC Bank, RBS Citizens, The Huntington National Bank and Comerica Bank.
Ramco-Gershenson also announced closed on the sale of Lantana Shopping Center, a 123,610-square-foot shopping center located in Lantana, Fla. The sales price was $16.9 million including the assumption of mortgage debt of $9.5 million. The sale is the first of three centers the company announced would be sold in 2011.
Capri Capital, JBG Urban Form JV
Capri Capital Partners LLC, on behalf of Capri Urban Investors LLC, formed a joint venture partnership with JBG Urban LLC, an entity jointly-owned by The JBG Cos. and MacFarlane Partners, to acquire a majority interest in North Bethesda Market in North Bethesda, Md., for $200 million.
North Bethesda Market is a newly constructed, transit-oriented mixed-use project. The development consists of 397 multi-family units plus 199,000 square feet of retail space anchored by a Whole Foods Market, Seasons 52, Arhaus and LA Fitness.
Prudential Mortgage Capital Provides $125M Loan for Clarendon Center
Prudential Mortgage Capital Co. closed a $125 million loan for Saul Centers, a Bethesda, Md.-based REIT, on behalf of Prudential’s General Account. Prudential Mortgage Capital Company is the commercial mortgage lending business of Prudential Financial Inc.
The loan provides construction take-out financing for Clarendon Center, a new 402,000-square-foot mixed use development located in Arlington, Va. that includes retail, office and luxury rentals in the Washington, D.C. metro area. The loan term is for 15 years with a 25-year amortization.
Clarendon Center is a class-A mixed use project consisting of two landmark towers situated adjacent to the Clarendon Metro station. The south tower contains 244 luxury apartments, 75,500 square feet of class-A office space and 29,500 square feet of ground floor retail anchored by Trader Joe’s. The north tower contains 95,500 square feet of class-A office space and 13,000 square feet of fully-leased ground floor retail.
Oliver McMillan Closes on Purchase of Streets of Buckhead
OliverMcMillan, a San Diego-based real estate firm that develops urban and mixed-use retail, entertainment and residential projects, announced the acquisition of The Streets of Buckhead, a six-block, eight-acre luxury mixed-use project located in the Atlanta's upscale Buckhead neighborhood. The firm acquired both the real estate and a loan secured by the development. It will consummate a foreclosure to finalize the acquisition process and move forward with a clean slate on June 7.
The development team plans to begin construction this year with an estimated completion date of 2013. The firm will work to evolve the architectural plans and re-engage the leasing efforts on the development, which stalled in the wake of the credit crunch. The firm expects to invest $300 million to complete the project, beyond the nearly $400 million spent to date.
In 2009, construction of The Streets of Buckhead stopped due to a lack of financing. OliverMcMillan announced plans to acquire the project in February 2011.
Cedar Reaches Deal to Sell Ohio Portfolio
Cedar Shopping Centers Inc. executed agreements for the sale of 17 properties, all located in Ohio, of which 14 are anchored by Discount Drug Mart. The aggregate sales price for the 17 properties is approximately $45 million subject to approximately $30 million of existing financing. Nickleplate Realty Trust LLC of Canton, Ohio, acquired the portfolio.
As a result of these transactions, Cedar will have substantially withdrawn from Ohio. Its remaining investment is limited to three single tenant net-leased national drug stores with self-amortizing debt.
As previously disclosed, the company included 14 of the 17 properties as "held for sale" at the end of the fourth quarter of 2010, taking an impairment of approximately $30 million for those properties. The transaction announced today, involving three additional properties, will result in an additional impairment in the first quarter of 2011 of approximately $3 million.
Closing of the sale of the balance of the properties is subject to normal closing conditions, including lender consents, and is expected within the third quarter.
Primestor & Pacific Southwest Land $42M Loan
Los Angeles-based Primestor Development Inc. and Pacific Southwest Realty Services closed a $42 million loan with John Hancock on the 248,000-square-foot La Alameda Shopping Center in Walnut Park, Calif. Kostas Kavayiotidis and Mike Davis of Pacific Southwest Realty Services arranged the financing of the 30-year loan. The rate is fixed for 10 years.
La Alameda Shopping Center is 95 percent occupied with tenants including Marshalls, Ross, CVS, Office Depot and Big 5 Sporting Goods.
Inland Purchases Two Centers for $38.7M
Inland Real Estate Acquisitions Inc. acquired two shopping centers located in Oklahoma and Wisconsin.
University Town Center, a recently-constructed 158,516-square-foot retail center in Norman, Okla., was purchased for approximately $32.5 million. A 61,065-square-foot Copps Grocery Store in Neenah, Wisc., was also purchased for approximately $6.2 million. The properties were acquired on behalf of Inland Diversified Real Estate Trust Inc.
Matthew Tice, vice president of Inland Real Estate Acquisitions, facilitated the purchase of University Town Center. Anchor tenants at University Town Center include TJ Maxx, Office Depot and Ulta. Petco, Dress Barn, Hallmark, Maurices, AT&T Cellular and Qdoba are among the other tenants at the center, which is shadow-anchored by a Super Target that was not purchased.
The acquisition of the Copps Grocery Store was facilitated by Joe Cosenza, president of Inland Real Estate Acquisitions. The property, constructed in 2001, is 100 percent occupied by Roundy’s Foods on a triple net lease that extends through 2022.
Broad Street Advisors Arranges JV to Acquire Two Lifestyle Centers
Broad Street Advisors arranged the joint-venture equity for the acquisition of Lafayette Pavilions and Porters Vale, two lifestyle centers located in Lafayette and Valparaiso, Ind., respectively.
The recently constructed centers contain such tenants as TJ Maxx, Office Depot, Hobby Lobby, Cinemark, Justice and Rue 21, and total 440,449 square feet. The purchaser is a joint venture between certain affiliates of a U.S.-based institutional investor and Indianapolis-based Lauth Group. Lauth was the prior owner and developer of the properties.
Broad Street Advisors was the exclusive advisor for the transaction. Robert Rizzi, managing partner at Broad Street, handled the transaction.
Lafayette Pavilions is a 337,652-square-foot class-A lifestyle center. Completed in October 2006, the 85 percent occupied property is anchored by TJ Maxx, Office Depot, and Hobby Lobby.
Porter’s Vale is a 91,897-square-foot class-A shopping center. Completed in October 2007, the 81 percent occupied property is anchored by Cinemark, Justice, Rue 21, and is shadow anchored by JC Penney.
World Class Capital Group Acquires Two San Antonio Centers
World Class Capital Group LLC purchased the 135,000-square-foot Westpark Plaza and the 70,000-square-foot Thousand Oaks Center, both in San Antonio, Texas, for an undisclosed price.
The seller of Westpark Plaza was a California-based investment partnership and Thousand Oaks was sold by a Texas-based investment partnership.
Westpark Plaza is anchored by FAMSA and The Room Store. Thousand Oaks Center is home to the Midnight Rodeo – which has been at the location for 30 years. The property is currently 83 percent occupied.
Mid-America Closes on Sale of Heritage Shops at Millennium Park
Mid-America Real Estate Corp.’s investment sales group announced the sale of the 105,449-square-foot Heritage Shops at Millennium Park in Chicago in a $31.6 million deal.
Acadia Realty Trust purchased the center from a venture of Mesa Development LLC. Mid-America’s Stan Nitzberg, Ben Wineman and Joe Girardi represented the seller in the transaction.
The Heritage Shops is anchored by a two-level LA Fitness and is complemented by Ann Taylor Loft, Lane Bryant/Cacique, McDonald’s Fannie May Candies, Intelligentsia Coffee, Fifth Third Bank and Subway. The property was completed in the fall of 2004 as a mixed-use development that includes a 57-story residential component located above the four-story retail/office component.
USAA Sells 16 Property Porfolio
USAA Real Estate Co. sold a portfolio of 16 single-tenant net-leased assets to an affiliate of The Inland Real Estate Group of Companies Inc., for an undisclosed price.
The retail portfolio totals 118,046 square feet of properties leased to tenants including Bank of America, Walgreens and AT&T, located in Florida, Georgia, Minnesota, Missouri, North and South Carolina, Oregon, Texas and Wisconsin. John Hammill and Ken Shulman of Dallas-based Capview Partners represented USAA in the transaction.
Other Notable Deals
SL Green Realty Corp. and Jeff Sutton formed a joint venture that has entered into an agreement to acquire the Times Square property located at 1552 Broadway from The Riese Organization, which will continue to operate the TGI Friday’s restaurant at the property at least until the summer of 2012. The transaction is expected to close during the third quarter of 2011.
Passco Companies LLC has purchased four CVS stores in sale-leaseback deals. All four stores are newly constructed and recently opened by CVS. Three of the stores are located in the Texas suburbs, two near Austin and one near Fort Worth. The fourth store is located in Bakersfield, Calif.
Cassidy Turley BRE Commercial represented the seller in the sale of a 56,606-square-foot shopping center in San Diego. Michael Pashaie/Arcadia Hub Holdings 1 LLC purchased the property from Sports Arena Shopping Center LLC for $7.3 million. Chuck Klein and Kevin Held of Cassidy Turley BRE Commercial represented the seller in the transaction. Scot Eisendrath of Cassidy Turley BRE Commercial provided financial advisory services.
Hanley Investment Group Real Estate Advisors announced that Edward B. Hanley and William B. Asher represented the NMC Grove Ontario LLC of Woodland Hills, Calif., in the sale of a 7,866-square-foot multi-tenant retail building within a Lowe's anchored shopping center in Ontario, Calif. The purchase price was not disclosed. Tenants include AT&T, Qdoba Mexican Grill and Wabi Sabi Sushi & Teppan. The building was 100 percent occupied at the time of sale. The buyer, Crystal Cal No. 1 LLC of Los Angeles, Calif., was represented by Stephen Chan of G.E. Property Management Inc.. The purchase was to fulfill a 1031 exchange.
A private investor acquired a Wells Fargo bank branch in Manhattan Beach, Calif., from 1129 Sepulveda BMPD LLC, a venture between Eastern Real Estate and the principals of Paragon Commercial Group and its investors. The approximately 4,000-square-foot building sold for more than $1,900 per square foot. Bill Bauman, executive vice president, and Kyle Miller, managing director, of Studley’s national retail services group, co-listed the property with Mike Grannis of Highland Partners. Studley and Highland Partners also represented the buyer in the transaction.