CHICAGO, May 30 /PRNewswire-FirstCall/ -- General Growth Properties, Inc.
(NYSE: GGP) announced agreements to acquire a 100% interest in both Saint
Louis Galleria in St. Louis, Missouri and Coronado Center in Albuquerque, New
Mexico from two different institutional owners. The company also announced an
agreement to acquire the 49% ownership interest in GGP Ivanhoe III currently
held by joint venture partner Ivanhoe Cambridge, thereby increasing its
ownership interest to a full 100%. The agreement to acquire Coronado Center
is subject to signing definitive documentation and all three of the
acquisitions remain subject to the satisfaction of customary closing
conditions.
The aggregate consideration for all of these acquisitions is anticipated
to be approximately $869 million. Approximately $243 million of existing
mortgage debt will be assumed in connection with the GGP Ivanhoe III
acquisition. The balance of the aggregate consideration, or approximately
$626 million, will be funded using a combination of new acquisition loans,
draws on an unsecured credit facility and new mortgage loans on currently
unencumbered properties.
The two new properties and increased share of previously owned malls are
currently anticipated to produce approximately $73 million of property net
operating income during the 12 month period from July 1, 2003 through June 30,
2004. Saint Louis Galleria and Coronado Center are expected to close in the
second half of June and the acquisition of the additional 49% interest in GGP
Ivanhoe III malls is expected to close in early July.
"Saint Louis Galleria and Coronado Center are premier centers in their
regions with strong cash flow and occupancy. Adding these malls to our
portfolio expands General Growth's ability to deliver exceptional retail
environments to our consumers," said John Bucksbaum, chief executive officer,
General Growth Properties. "Through the Ivanhoe transaction, we are pleased to
increase our ownership in properties that have added outstanding value to our
portfolio during the last five years of ownership and from which we expect
significant further value creation in the years to come."
Saint Louis Galleria opened in 1986 and was last renovated and expanded in
1991. The two-level center is just over 1.2 million square feet and is
anchored by Dillard's, Lord & Taylor, Famous-Barr, and Mark Shale. In-line
specialty retail space comprises approximately 430,000 square feet. The center
is currently 96% occupied with sales productivity of approximately $505 per
square foot.
Coronado Center opened in 1964 and was most recently renovated in 1995.
The center is over 1.1 million square feet, with approximately 400,000 square
feet of in-line specialty retail space. Anchors include Foley's, Sears, J.C.
Penney, Macy's, and Mervyn's. Coronado Center is currently 94% occupied with
sales productivity of approximately $354 per square foot.
GGP Ivanhoe III is currently owned 51% by the company and 49% by an
affiliate of Ivanhoe Cambridge of Montreal, Quebec, Canada. General Growth
has agreed to purchase Ivanhoe's share of GGP Ivanhoe III. The properties
included in this transaction are Landmark Mall, Alexandria (Washington DC),
Virginia; Mayfair, Wauwatosa (Milwaukee), Wisconsin; Meadows Mall, Las Vegas,
Nevada; Park City Center, Lancaster (Philadelphia), Pennsylvania; Oglethorpe
Mall, Savannah, Georgia; Oak View Mall, Omaha, Nebraska; and Northgate Mall,
Chattanooga, Tennessee. Eastridge Mall in San Jose, California, currently
part of GGP Ivanhoe III, will be transferred to a new joint venture, GGP
Ivanhoe IV, with General Growth continuing to own 51% and Ivanhoe Cambridge
continuing to own the remaining 49%.
General Growth Properties is the country's second largest shopping center
owner, developer and manager of regional shopping malls. General Growth
currently has ownership interests in, or management responsibility for, a
portfolio of 160 regional shopping malls in 39 states. The company portfolio
totals approximately 140 million square feet of retail space and includes over
16,000 retailers nationwide. A publicly traded Real Estate Investment Trust
(REIT), General Growth Properties is listed on the New York Stock Exchange
under the symbol GGP. For more information on General Growth Properties and
its portfolio of malls, please visit the company web site at
http://www.generalgrowth.com .
Ivanhoe Cambridge is one of Canada's leading property owners, managers,
developers, and investors. The company focuses on high quality shopping
centers in urban areas across Canada and the United States. Its real estate
portfolio of 49 million square feet of retail space consists mainly of 50
regional and super-regional shopping centers.
This release may contain forward-looking statements that involve risks and
uncertainties. All statements other than statements of historical fact are
statements that may be deemed forward-looking statements, which are subject to
a number of risks, uncertainties and assumptions. Representative examples of
these risks, uncertainties and assumptions include (without limitation)
general industry and economic conditions, interest rate trends, cost of
capital and capital requirements, availability of real estate properties,
competition from other companies and venues for the sale/distribution of goods
and services, changes in retail rental rates in the company's markets, shifts
in customer demands, tenant bankruptcies or store closures, changes in vacancy
rates at the company's properties, changes in operating expenses, including
employee wages, benefits and training, governmental and public policy changes,
changes in applicable laws, rules and regulations (including changes in tax
laws), the ability to obtain suitable equity and/or debt financing, and the
continued availability of financing in the amounts and on the terms necessary
to support the company's future business. Readers are referred to the
documents filed with the SEC, specifically the most recent reports on Forms
10-K and 10-Q, which identify important risk factors which could cause actual
results to differ from those contained in the forward-looking statements.
SOURCE General Growth Properties, Inc.
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Related links:
http://www.generalgrowth.com
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CONTACT:
John Bucksbaum, +1-312-960-5005, or Bernie
Freibaum, +1-312-960-5252, Beth Coronelli, +1-312-960-2750, both
of General Growth Properties
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