FINANCE

Unusual deal gives Aeropostale new lease on life — and it just got better

BY Marianne Wilson

A first-of-its kind arrangement has saved Aeropostale.

A consortium made up of Authentic Brands Group (ABG) and two of the nation’s largest real estate companies — General Growth Properties and Simon Property Group — announced it has finalized the acquisition of the teen apparel retailer. It is the first time that mall operators have participated in a deal to acquire a retail chain.

“This consortium brings a new approach to brand development and Aeropostale brings another facet to ABG’s fashion portfolio,” said Jamie Salter, chairman and CEO, Authentic Brands, whose portfolio includes Juicy Couture, Jones New York, Judith Leiber, Frederick’s of Hollywood,Hickey Freeman, and Hart Schaffner Marx. “We look forward to working closely with our new partners, General Growth Properties and Simon Property Group to continue to grow the Aeropostale brand on a global scale.”

Under the arrangement, Aeropostale will operate approximately 400 stores in the U.S. and Canada and approximately 300 doors across Latin America, Europe, the Middle East and Southeast Asia. Under the original plan approved by the bankruptcy court judge, 229 stores, all in Simon and General Growth malls, were to be kept open. But Jamie Salter told the New York Post he was able to increase the number of saved Aeropostale stores to 400 after other landlords “cooperated with our business plan.” The rent reductions allowed the additional 171 stores to stay open.

"Aeropostale has significant brand equity and the go-forward portfolio of stores generates more than $1 billion in global retail sales, over $800 million of which is from the U.S.,” said Sandeep Mathrani, CEO, GGP. “The entity is financially secure and well capitalized and we are very pleased that thousands of jobs will be preserved.”

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E.Steiner says:
Sep-19-2016 12:20 pm

Unusual is not good
Unless Simon and GGP have a short term exit strategy on this acquisition, this is a glaring symptom of the continued inevitable decline of malls and poor underlying fundamentals despite divestiture of lower grade assets by these companies. This is not a diversification of investments or a protective measure for these companies, it's a Trojan Horse.

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REAL ESTATE

Glimcher exec moves to Olshan to head retail

BY Al Urbanski

Kenneth Marshall, a 25-year veteran of the retail real estate industry, has joined Olshan Properties as head of retail. For the last two years, he was VP of development at WP Glimcher.

Marshall began his career in 1991 with Urban Retail Properties and worked there for 12 years, rising to VP of development. He did stints at Westfield, Colonial Properties Trust, and Mid-America before joining Glimcher.

At Olshan, he will lead the commercial real estate team and manage leasing, operations, and development functions for a 10 million-sq.-ft. portfolio.

“Ken comes to us with deep industry relationships and track record of based on a disciplined approach to investing, excellent leadership abilities’ and an exceptional foundation in real estate grounded in his academic focus in architecture,” said CEO Andrea Olshan.


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DEALS

Inland sells FedEx facility

BY Al Urbanski

Inland Private Capital Corporation has sold a FedEx Ground facility in Zionsville, Indiana, for $37.1 million.

The 303,000-sq.-ft. FedEx center was constructed just two years ago on the property, which covers two land parcels totaling 49 acres in the town 17 miles northwest of downtown Indianapolis.

“We purchased the property in September 2014, and it performed positively, resulting in a substantial return for our investors and an opportunity for them to invest a significant portion of the proceeds into other properties owned by different Inland-sponsored programs,” said Keith Lampi, president and COO of IPCC, which is part of The Inland Real Estate Group of Companies.


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