REAL ESTATE

Blackstone and DDR close $1.4 billion EDT acquisition

BY Staff Writer

Beachwood, Ohio — Blackstone’s flagship real estate fund and DDR Corp. announced Thursday hat a joint venture formed by the two entities has closed on the acquisition of a portfolio of 46 shopping centers previously owned by EPN Group.

The joint venture has assumed approximately $635 million of senior non-recourse debt and has originated an additional $320 million non-recourse loan facility, which has a five-year term.

DDR’s contribution was $17 million of common equity, $150 million of preferred equity with a fixed dividend rate of 10%, and DDR assumed a pro rata share of joint venture debt of $48 million. As previously announced, DDR will fund its entire investment with proceeds from the January issuance of 19 million common shares on a forward basis to be settled shortly.

Blackstone Real Estate Partners VII, a real estate fund managed by Blackstone on behalf of its investors, owns 95% of the common equity of the joint venture and an affiliate of DDR owns the remaining 5%. DDR will continue to provide leasing and management services and has the right of first offer to acquire ten of the assets under specified conditions.

The 46 shopping centers acquired by the joint venture are open-air, value-oriented power centers located in 20 states, representing 10.6 million sq. ft. and are currently 90% leased. The top ten tenants by base rent include the TJX companies, Kohl’s, PetSmart, Dick’s Sporting Goods, Best Buy, Bed Bath & Beyond, JoAnn’s, Old Navy, Walmart and Home Depot.

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REAL ESTATE

Wal-Mart Mexico cuts 2012 store openings as new procedures delay process

BY Katherine Boccaccio

Mexico City — Wal-Mart Stores’ Mexico subsidiary said Wednesday that new store openings for 2012 will be cut from the originally planned 410 to 430 stores to 325 to 335, due in large part to added real estate documentation procedures.

Expansion plans for new stores will be delayed by 60 to 90 days, said Wal-Mart Mexico, as the retailer institutes reinforced documentation around real estate projects. Wal-Mart Mexico has been in the throes of a bribery scandal involving alleged payments to middlemen to accelerate the store-opening process.

The company said it will spend $17.5 billion – an 11% reduction from the initial plans – to open the downwardly revised 325 to 335 new stores in Mexico and Central America in 2012, representing an 8.1% annual expansion rate. The original 430 store count may still be reached, said the retailer, but it would be by the end of first quarter 2013, rather than end of 2012.

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REAL ESTATE

Saks Off 5th to open in Carousel Center, Syracuse, N.Y.

BY Staff Writer

New York — Saks Fifth Avenue’s Off 5th plans to open its doors in Syracuse’s Carousel Center on June 21.

The 24,962-sq.-ft. store will be located in the center’s new expansion area called Destiny USA, which is the largest LEED certified commercial retail project in the country.

The new store will feature the company’s ‘luxury-in-a-loft’ store design, which maximizes efficiency and flexibility, enabling easy changes in the general layout. The store will be bright, uncluttered, with no hard aisles and one consistent hard-surface floor throughout. All fixtures will be on casters, ensuring ease in movement, and all hardware will be interchangeable between fixtures.

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