CHICAGO, Aug. 26 /PRNewswire-FirstCall/ -- General Growth Properties, Inc.
(NYSE: GGP) today announced the formation of a new 50/50 joint venture with
Teachers' Retirement System of the State of Illinois. The venture, GGP-TRS
L.L.C., today acquired the four enclosed regional malls described below.
GGP-TRS L.L.C. acquired Galleria at Tyler in Riverside, California,
Kenwood Towne Centre in Cincinnati, Ohio, and Silver City Galleria in Taunton,
Massachusetts from an institutional investor. Clackamas Town Center in
Portland, Oregon, which was 100% owned by Illinois Teachers', was also
conveyed to the new joint venture.
The four enclosed regional malls are valued at approximately $634 million
and are encumbered by approximately $412 million of nonrecourse mortgage
loans. An existing $75 million fixed rate loan on Silver City Galleria
bearing interest at 7.41% was assumed and three new acquisition loans totaling
approximately $337 million were obtained. The new loans bear interest at a
weighted average rate of LIBOR plus 76 basis points. General Growth's share
of the equity was provided by cash on hand plus a portion of new unsecured
loans that will total $150 million and bear interest at LIBOR plus 100 basis
points. This new unsecured debt is being obtained by General Growth's wholly
owned Victoria Ward subsidiary, which was previously unencumbered following
its recent acquisition for $250 million. The joint venture is expected to
generate approximately $55 million of net operating income over the next
twelve months. General Growth believes that each of the four malls is well
positioned in its local market. Current average sales are approximately $408
per square foot and current average occupancy is approximately 86%.
"All four of these regional shopping centers produce strong current cash
flow," said John Bucksbaum, General Growth's CEO. "We look forward to further
enhancing the value of these centers by applying our expertise in the areas of
operations, leasing, remerchandising and redevelopment."
"We are happy to have helped bring GGP-TRS L.L.C. to fruition," said Mark
Kirincich, President of Commonwealth Realty Advisors, the investment advisor
to Illinois Teachers' on this transaction. "Illinois Teachers' and General
Growth Properties seemed like the perfect fit. Both entities concentrate on
investing wisely and, in this investment, goals align perfectly to create
value for both parties."
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 167 regional shopping malls in 41 states. The company portfolio
totals approximately 145 million square feet of retail space and includes over
15,000 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 .
Teachers' Retirement System of the State of Illinois represents Illinois
educators teaching outside the City of Chicago and includes 285,000 active and
retired members.
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.
 back to top
Related links:
http://www.generalgrowth.com
Photo Notes:http://www.newscom.com/cgi-bin/prnh/19990208/CGM015
PR Newswire Photo Desk, +1-888-776-6555 or +1-212-782-2840
Company News On-Call:
http://www.prnewswire.com/comp/110740.html
CONTACT:
Bernard Freibaum, +1-312-960-5252, or John
Bucksbaum, +1-312-960-5005, both of General Growth Properties,
Inc.
|
