ALBUQUERQUE-Simon Property Group has expanded its footprint in the local market, acquiring ABQ Uptown, a 222,000-square-foot lifestyle center here, for $86 million. The Indianapolis-based REIT owns the dominant regional mall in the market, Cottonwood Mall.
Developed by Hunt Development Group, ABQ Uptown is the only lifestyle center in the entire state. The property is 95% leased to tenants including: Ann Taylor, Ann Taylor Loft, Anthropologie, Apple Computer, BCBG Max Azria, California Pizza Kitchen, Francesca's Collections, L'Occitane, Lucky Brand Jeans, Pottery Barn and Williams-Sonoma. It generates sales of approximately $650 per square foot, according to Simon.
“We like the deal we did in Albuquerque,” said the REIT’s Chairman and CEO David Simon during its second quarter earnings call. “It's very well positioned, and consumers love it, retailers love it, and we think there's upside.”
Simon added that the REIT had evaluated other lifestyle centers for acquisition and found that ABQ Uptown offered the best investment opportunity. “We saw one… in Carlsbad,” he said. “Based on how we looked at it and underwrote it, [it offered] very little growth for a much more aggressive price than anywhere near…Albuquerque.”
Simon funded the acquisition of ABQ Uptown with proceeds from the sale of Jeffersonville Premium Outlet in Jeffersonville, OH. Tanger Outlets bought the property for $134 million, representing an 8.2% cap rate, according to Barclays Capital. The sale was required as part of the FTC’s approval of Simon’s Prime Outlets acquisition.
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