Chelsea Adds 2nd Sin City Center for $104M

LAS VEGAS-Chelsea Property Group Inc. has closed on its purchase of Belz Factory Outlet World – Las Vegas, a 477,000-sf single-level indoor mall located a couple of miles south of The Strip on Las Vegas Boulevard near McCarran International Airport.

The Roseland, NJ-based shopping center REIT acquired the property from entities affiliated with privately held Estein & Associates USA Ltd. for $104 million. The purchase price included the assumption of a $24.4 million 8.12% mortgage due 2012 and, for the cash portion, a $100-million one-year bridge loan provided by Wachovia Bank, N.A. at an interest rate of LIBOR plus 80 basis points. The capitalization rate on the investment is estimated at 10%.

The center opened in 1993 with 255,000 sf and was expanded to its current size in 1996. The center is 99% leased to approximately 130 tenants and posted 2002 sales averaging $390 per sf and occupancy costs averaging less than 7% of sales, according to Chelsea.