The Mills Corp., a REIT based here, owns, develops, leases, manages andmarkets a dozen market-dominant retail and entertainment destinations totaling approximately 17 million sf in 10 states. The company has five projects under construction and development in the US and one in Toronto, Canada.
The refinancing is the first of several planned transactions aimed at improving the company's balance sheet, according to company officials who say they hope to fund near-term projects while maintaining cash flow, replace variable-rate debt with fixed-rate mortgages, and extend the weighted average maturity of the company's debt.
"Our proposed financial plan delivers a capital structure that will position us to take advantage of our industry leading growth opportunities while locking up fixed interest rates at today's very attractive pricing levels," says Ken Parent, chief financial officer. "With historic project equity returns in excess of 20%, these accretive transactions will positively enhance shareholder value without issuing common stock, which we believe to be significantly under valued."
On top of the proceeds raised in the Gurnee Mills-Potomac Mills refinancing, company officials say they anticipate raising additional equity of up to $75 million through corporate-level preferred equity or project-level financing from new joint venture partners. They anticipate those proceeds will furnish the company's equity needs through 2002, primarily funding projects for Discover Mills in Atlanta, Colorado Mills, Vaughn Mills in Toronto, Missouri Mills and the retail portion of Meadowlands Mills in Northern New Jersey.
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