Prime Retail Sells of Some of its Assets to Pay Down Debt

BALTIMORE-Prime Retail Inc., based here, is planning to sell four of its outlet centers–Gilroy, CA; Michigan City, IN; Waterloo, NY and Kittery, ME–for $240 million to an affiliate of New York-based Fortress Investment Fund LLC, according to company officials. It is also obtaining up to $71 million in mezzanine financing from Fortress. After closing costs and fees, the combined transaction with the planned $25 million first mortgage financing on the company’s outlet center in Puerto Rico, will raise an aggregate of approximately $150 million net proceeds.

“The Fortress transaction is intended to stabilize the company’s financial condition and strengthen the company’s balance sheet by reducing our overall level of debt and extending certain loan maturities,” says Glenn D. Reschke, Prime Retail’s chairman, president and CEO.