Cary, N.C.-based FAC Realty Trust Inc. entered an agreement with Boca Raton, Fla.-based Konover & Associates South, a privately held real estate development firm, to acquire 11 community shopping centers totaling 2 million sq. feet and valued at $100 million. The purchase equates to approximately $24 million in equity consisting of the issuance of operating partnership units, at $9.50 per unit, and/or cash, plus the assumption of $76 million in debt.
The deal, which is expected to close by the end of the second quarter, will give FAC ownership and operation of properties in excess of 8.5 million sq. ft., and give the new company a total market capitalization of $500 million. The combined entity will operate as Konover Property Trust and remain listed on the New York Stock Exchange. The 11 centers are in FAC Realty's target markets of Florida, North Carolina, Alabama, Virginia and Georgia. "This acquisition expands significantly the presence of neighborhood and community shopping centers in FAC Realty's increasingly diversified portfolio," says C. Cammack Morton, president and chief executive officer.
Simon Konover, founder of West Hartford, Conn.-based Konover & Associates, will become chairman of the board of Konover Property Trust upon completion of the transaction. Although Simon Konover oversees the hospitality and apartment portfolios of Konover & Associates, the portfolio of 100 shopping centers (11 million sq. ft.) is run by Michael Konover, CEO and principal owner. All assets of Konover & Associates will continue to be privately owned and independently operated.
Baltimore-based Prime Retail Inc. and Muskegon, Mich.-based Horizon Group Inc. have amended the terms of their recent merger agreement. Among the changes under the new agreement:
* Prime Retail will acquire 22 (instead of 20) Horizon outlet centers;
* Fifteen properties, including two centers acquired from Prime, will be operated by the newly formed entity Continuing Horizon;
* Horizon is released from long-term lease obligation at the Dole Cannery in Honolulu by the formation of a joint venture with affiliates of Honolulu-based Castle & Cooke Properties Inc., the project's landlord.
Houston-based Weingarten Realty Investors and Denver-based Miller Development Inc. have formed Miller/Weingarten Realty Co. to develop, acquire, lease and manage shopping centers in five Western states. The newly formed company, which will be based in Denver, has a combined portfolio of 24 million sq. ft. of retail and industrial GLA.
Stewart Miller, former president of Miller Development, will serve as same for Miller/Weingarten Realty Co. Drew Alexander will remain president of Weingarten Realty Investors.