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Shopping Centers Today -> May 1998
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DEAL OF THE MONTH: Ford Motor Co. and Petrie-Dierman-Kughn have agreed to sell The Great Mall of the Bay Area, Milpitas, Calif., southeast of San Francisco, to Michael Swerdlow Co., Miami, and Colony Capital Co., Los Angeles. The sale price of the 1.3 million-square-foot property was more than $130 million. The property has suffered from sluggish sales and some tenant vacanies. Ford officials told a local publication, The Business Journal, that the company has not been actively marketing the 191-store center, but that several possible buyers have approached them. Ford spent $125 million to develop the mall.
Newhall sells center
The Newhall Land and Farming Co., Valencia, Calif., has entered into an agreement with a private real estate investor to sell the 720,000-square-foot Valencia Marketplace shopping center for $111 million. About 75% of the leaseable space is completed, and 84% is leased. Tenants include Wal-Mart, Toys 'R' Us, Circuit City and Staples.*
Projects sell for $184M
Developers Diversified Realty Corp., Cleveland, will acquire eight shopping centers and parts of five others owned by Continental Real Estate Cos., Columbus, Ohio, for $184 million. In the deal, DDR has completed the acquisition of eight centers in central Ohio and interests in two centers in Columbus, and will close shortly on the acquisition of interests in three additional centers in Dayton and Columbus.*
TIAA looks for centers
Teachers Insurance Annuity Association-College Retirement Equities Fund (TIAA-CREF) plans to invest about $1.5 billion in shopping centers in 1998, both in the United States and internationally. TIAA invested a total of $5.4 billion in commercial real estate in 1997, with about $1.1 billion going to retail projects. "We expect to do at least as much as we did last year, probably more, and it's likely we'll invest about 25% of our funds in shopping centers in 1998," Kathleen M. Nelson, managing director of the TIAA mortgage and real estate division, told SCT Xtra, SCT's weekly fax newsletter.*
Simon, DLJ in venture
Simon DeBartolo Group, Indianapolis, and DLJ Real Estate Capital Partners LP, New York, plan to form a joint venture with Cincinnati-based Madison Marquette to develop lifestyle/entertainment retail projects. The joint venture will target upscale, open-air centers. Madison will invest a "significant" (but undisclosed) sum in the venture.Kranzco forms alliance
Kranzco Realty Trust, Conshohocken, Pa., and New America International, a private real estate brokerage and services company based in Hightstown, N.J., have formed a strategic alliance that will recapitalize NAI as a public company. The REIT will conduct an exchange offer for 80% of the common stock of NAI and then spin off approximately 88% of NAI shares to existing Kranzco shareholders on a one-for-one basis. When the deal is completed, Kranzco will own 9.8% of NAI's stock.*
Weingarten forms fund
Weingarten Properties, Philadelphia, a real estate investment, development and management company specializing in shopping centers, has formed a $200 million real estate fund to acquire shopping centers in the northeastern United States. Its acquisition plans include buying assets from distressed sellers and projects that need redevelopment and repositioning. Weingarten Properties -- not affiliated with Weingarten Realty Investors, Houston -- currently owns and operates more than 2.5 million square feet of retail properties.*
Riocan acquires 11 centers
RioCan Real Estate Investment Trust, Toronto, has agreed to acquire 11 shopping centers, containing 2.2 million square feet, from Burnac Corp. for a total of $236 million (Cdn). Six of the centers are in Ontario and are anchored by major supermarket chains. The other five are in the Montreal metropolitan area.*
Weingarten in joint venture
Weingarten Realty Investors, Houston, and Miller Development Inc., Denver, have formed a new company to develop and acquire shopping centers in the West and Midwest. Miller Weingarten Realty Co. will acquire properties in Colorado, Nebraska, Wyoming, Utah and Montana.Shopping Centers Today
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