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EDINA, MN-Southdale, the first enclosed shopping mall in the US, has been sold to Mills Corp., an Arlington, VA-based REIT known as a redeveloper. The $452-million deal, which includes Southridge Mall in suburban Milwaukee, was sold by a joint venture that includes Blackstone Real Estate Advisors affiliates and Polaris Capital.
"We believe these strong performing, market-dominant properties present us with attractive redevelopment and remerchandising opportunities that will result in higher sales productivity for our tenants and enhanced investment returns," says Laurence Siegel, chairman and chief executive officer of Mills. "The former Mervyn's store at Southdale provides a range of opportunities including the potential for a new fashion department store with additional small shop [space]."
Approvals are in place to possibly add another new high fashion department store anchor at Southdale on a vacant pad, according to Mills. Neiman Marcus is rumored to be interested in opening a store at the center.
Southdale Center has about 1.3 million sf of space and is anchored by one of May Co.'s top-producing Marshall Field's department stores, with sales reportedly at $440 per sf. JCPenney and Marshall's also are anchors. Southdale Center also has more than 120 specialty stores, including Crate & Barrel, Guess, Coach and J. Crew, as well as a 16 screen AMC theater and a top performing restaurant line-up including the Cheesecake Factory, Maggiano's and PF Chang's China Grill. The center is located near four major roadways--France Avenue, W. 66th Street, York Avenue and W. 69th Street.
At Southridge, the vacant Younker's department store has 46,000-sf that has not been leased and provides Mills with an "attractive opportunity to increase the property's operating income," Siegel says. Southridge has 1.2 million sf and four department store anchors--JCPenney, Sears, Kohl's and Boston Store.
Stephen Livaditis, managing director of New York-based Eastdil Realty Co. and head of its Chicago office, helped broker the deal. Mills owns, develops, leases, manages and/or markets a portfolio of 39 retail and entertainment destinations totaling about 48 million sf. The company has six projects under construction or development around the world.
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