The Mills Corp. has agreed to acquire six mallin two transactions for a total of $621 million. The purchases are expected to generate a return of approximately 9% and are scheduled to close by Jan. 31, 2003.
The Arlington, Va.-based REIT will acquire from Cadillac Fairview a 100% interest in five mall properties, including the 999,000 sq. ft. Broward Mall in Ft. Lauderdale, Fla.; the 757,000 sq. ft. Dover Mall and the 52,000 sq. ft. Dover Commons in Dover, Del.; the 885,000 sq. ft. Galleria at White Plains in White Plains, N.Y.; the 961,000 sq. ft. Northpark Mall in Jackson, Miss.; and the 909,000 sq. ft. The Esplanade in New Orleans, La. Mills will also purchase the 637,000 sq. ft. Riverside Square in Hackensack, N.J., from an unrelated third party.
The properties, which have an average occupancy rate of 91.3%, will add nearly 5.3 million sq. ft. to Mills’ portfolio. The REIT plans to spend $325 million to $350 million for renovations over the next two to three years in each of the six super-properties, which generate an average sales per sq. ft. of $370.
"Mills has long been known for creating retail and entertainment destinations under the ‘Mills’ branded flag," said Laurence Siegel, chairman and CEO, in a statement. "Now we are applying to more conventional full-priced retail venues the principles that have differentiated us in the marketplace."
In addition to the six mall properties, Mills has also entered into a contract to purchase general partnership interests in Town Center at Cobb and Gwinnett Place, both in Atlanta. These purchases are expected to be completed during the first half of 2003.