New Partnership in Macerich's Dominant Queens Center Generates $150 Million
SANTA MONICA, Calif., July 30 /PRNewswire-FirstCall/ -- The Macerich Partnership, L.P., the operating partnership of Macerich(R) (NYSE: MAC), and long-time partner The Cadillac Fairview Corporation Limited today announced a joint venture in Macerich's dominant New York City asset, Queens Center.
Queens Center is a 966,499-square-foot urban retail development anchoring Queens, N.Y., one of the most concentrated and dynamic markets in New York City. The property produces annual mall sales (spaces 10,000 square feet or less) of $876 per square foot as of year-end 2008, making it the top-performing asset in Macerich's portfolio of high-quality retail real estate in the country's most powerful markets. Queens Center leads the industry as one of the most productive regional shopping centers in the United States.
Macerich purchased Queens Center in 1995 and, in 2004, transformed the property with a redevelopment and expansion that added approximately 380,000 square feet of new specialty shop space and an adjacent parking structure connected to the center via pedestrian bridge. Year-end 2008 occupancy was 97.5%. Queens Center is anchored by highly successful JCPenney and Macy's department stores and features approximately 165 specialty retailers and restaurants.
Under the terms of the deal, Macerich receives approximately $150 million in net cash and Cadillac Fairview acquires 49% interest in the asset.
"Strategic joint ventures are at the core of Macerich's business model and this deal makes it possible for Macerich and Cadillac Fairview to build on a partnership that spans more than a decade and has delivered strong results, both from a financial and a real estate perspective," said Macerich President Edward C. Coppola. "Queens Center is the first in a series of transactions in the execution of our joint venture strategy, through which we expect to raise $500 million in equity."
"This is a very powerful partnership and, particularly given the challenging economic environment, Macerich and Cadillac Fairview had an opportunity to leverage an already-lucrative partnership that will deliver value over time," noted Andrea Stephen, Executive Vice President of Investments for Cadillac Fairview. "Very few companies have the ability to accomplish a deal of this nature in this environment, and this is exactly why the Macerich/Cadillac Fairview partnership model is a competitive strength."
This is the eighth regional shopping center to be joint ventured for the two entities: Macerich and Cadillac Fairview co-own seven of the country's top-performing regional shopping centers in California and the Pacific Northwest, including Lakewood Center and Los Cerritos Center in greater Los Angeles and Washington Square in Portland, Ore.
