CHICAGO, Dec. 19 /PRNewswire-FirstCall/ -- General Growth Properties, Inc.
(NYSE: GGP) today announced three additions to existing 50/50 joint ventures.
The acquisitions include Florence Mall, in Florence, Kentucky; the other 50%
interest in The Woodlands Mall, in The Woodlands (Houston), Texas; and First
Colony Mall in Sugar Land (Houston), Texas. General Growth currently manages
Florence Mall and First Colony Mall through its third party management
subsidiary.
First, Florence Mall has been purchased from an institutional investor by
General Growth's 50/50 joint venture with Teachers' Retirement System of the
State of Illinois. Florence Mall, a two-level center, was originally developed
in 1974 and the most recent major renovation was completed in 1994. The
center, with nearly one million total square feet, is anchored by Sears, J.C.
Penney, Lazarus, and Lazarus Home Store. The mall is currently approximately
92% occupied and produces sales of approximately $357 per square foot.
In addition, GGP/Homart, one of General Growth's 50/50 joint ventures with
New York State Common Retirement Fund, has purchased the 50% interest that it
did not own in The Woodlands Mall from The Woodlands Commercial Property
Company, LP. The Woodlands Mall, with 1.2 million square feet, was built in
1994. Plans to expand the shopping center and add additional retail space are
currently being finalized. The center, anchored by Dillard's, Foley's, J.C.
Penney, Mervyn's, and Sears, is currently approximately 96% occupied with
sales of approximately $400 per square foot.
Finally, GGP/Homart II L.L.C., General Growth's other 50/50 joint venture
with New York State Common Retirement Fund, expects to acquire First Colony
Mall from an institutional investor on or before December 31, 2002. First
Colony, which opened in 1996, and is anchored by Foley's, Dillard's, J.C.
Penney, and Mervyn's, has nearly one million total square feet, is
approximately 91% occupied, and produces sales of approximately $358 per
square foot.
The gross consideration for 100% of all three acquisitions will be
approximately $276 million, including the assumption of approximately
$31 million of existing fixed rate mortgage debt that currently encumbers The
Woodlands Mall. It is also currently anticipated that 100% of the net
operating income from all three acquisitions will approximate $24 million in
calendar year 2003, with General Growth's share equal to approximately
$12 million.
Funding for the two GGP/Homart acquisitions will be provided by a new
$67 million non-recourse loan on First Colony bearing interest at LIBOR plus
80 basis points; $50 million of excess proceeds from a new 10-year fixed rate,
non-recourse loan on Stonebriar Centre in Frisco (Dallas), Texas in the amount
of $185 million and bearing interest at 5.23%, which replaced an existing
$135 million floating rate loan; and cash on hand in the two joint ventures.
Funding for Florence Mall was provided by a new $60 million non-recourse
loan bearing interest at LIBOR plus 89 basis points and equity contributed by
the partners, which in General Growth's case, was sourced from cash on hand.
"General Growth currently manages all three of these properties either
through ownership or in our third party management subsidiary," said John
Bucksbaum, Chief Executive Officer of General Growth. "These centers are
strong producers and their addition to our portfolio will further build upon
the strength and success of our joint ventures. Florence Mall is a perfect
complement to our recently acquired Kenwood Towne Centre in Cincinnati, Ohio,
and First Colony and The Woodlands further solidify our formidable retail
position in the greater Houston market."
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 169 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 .
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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CONTACT:
Bernard Freibaum, +1-312-960-5252, John
Bucksbaum, +1-312-960-5005, or Beth Coronelli, +1-312-960-2750,
all of General Growth Properties, Inc.
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