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Shopping Centers Today -> September 2007
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CBL TAKES ST. LOUIS IN $1.03 BILLION DEAL
CBL plans to become the dominant mall landlord in St. Louis through two deals with Westfield. In one deal, Westfield will contribute three of its St. Louis centers to a joint venture controlled by CBL that owns nine CBL properties around the U.S. Westfield will retain a minority interest valued to be at least $420 million, and CBL will lease and manage the properties and pocket the cash flow. In a separate deal, CBL will buy Westfield’s Chesterfield Mall, also in St. Louis, outright. CBL already owns one mall in the St. Louis market, St. Clair Square, in the suburb of Fairview Heights, Ill. CBL values the four St. Louis malls at a total $1.03 billion and sets a 6.2 percent cap rate on the acquisition. “The combination of these four malls and our existing St. Clair Square provides us with a dominant platform in the St. Louis market to maximize leasing results, management synergies, and redevelopment opportunities,” said Stephen D. Lebovitz, CBL’s president, in a press release. CBL will assume a $140 million nonrecourse loan secured by Chesterfield Mall and bearing a fixed interest rate of 5.74 percent.
GGP DEMANDS MORE BENEFITS FOR JANITORS
General Growth says it is demanding that its janitorial services vendors offer workers affordable health insurance and market-based wages. Beginning Labor Day the firm will require these vendors to sign contracts agreeing to furnish health plans that are 75 percent employer-paid, a cost that will ultimately be borne by GGP. Some 3,000 janitors working at least 20 hours per week at the firm’s 147 malls will be eligible. “As a company, we want to encourage our vendors to do the right thing for the people who show up every day and make our malls the special places they are,” said John L. Bucksbaum, SCSM, chief executive of GGP, in a press release. “It is important to us that the janitorial staff in our malls has access to affordable health care for themselves and their families. I’m proud to announce this new initiative.” The new program will be phased in as vendor contracts expire over the next 24 months. The wage increase will be based on regional market conditions; for most, it will range between 20 percent and 25 percent.
CHILE RETAILERS UNITE TO BUILD MALLS IN PERU
Rival Chilean retail conglomerates Falabella and Ripley announced the creation of Inversiones Corporativas Alfa, a venture to develop malls in Peru. Each holds a 40 percent stake; the rest belongs to Plaza Oeste, a subsidiary of Chilean mall developer Mall Plaza. (Falabella is Mall Plaza’s main shareholder.) Falabella’s investment is channeled through its Peruvian subsidiary, Malls Perú; Ripley is investing through its parent, Ripley Corp. The venture’s first three projects are already under way outside Lima — in Callao, Santa Anita and Trujillo — for a total investment of $138 million. Falabella’s Financiera CMR is already Peru’s biggest credit card issuer, with about 1.3 million issued cards that can be used to shop at Falabella’s retail units: the Falabella department store, the Tottus hypermarket and the Sodimac home improvement chain.
 | Current Issue December 2008 |