ST. LOUIS-General Growth Properties Inc. and the Canada Pension Plan Investment Board agreed to partner to buy the 482,000-square-foot Plaza Frontenac here, with GGP taking a 55% interest. The pension board has also agreed to take a 26% interest in GGP’s Saint Louis Galleria, also located here.
Evanston, IL-based Davis Street Land, in a partnership with Verizon Communications Pension Fund, sold the Plaza property at 1701 S. Lindbergh Rd. Terms of both deals were not disclosed. The Chicago-based GGP and the Toronto-based pension board will own the properties under a joint venture.
Jones Lang LaSalle represented Davis in the Plaza sale. Margaret Caldwell with JLL tells GlobeSt.com that Verizon wanted to sell, and it felt like a good time in the market. “It’s a jewel of a property, with sales increasing in the past couple of years,” she says. The 482,000-square-foot mall, built in 1974 and anchored by Saks Fifth Avenue and Neiman Marcus, is 96% leased, and has inline sales of more than $500 per square foot.
The one-million-square-foot Galleria property at 1105 Saint Louis Galleria has more than 165 specialty stores. Anchored by Macy’s, Dillard’s and Nordstrom, the property has inline sales of more than $585 square feet.
The sales figures are key to these mall trades, as the top owners are trying to beef up their profiles to investors, Caldwell says. “Whether it’s GGP, Glimcher or Simon, they want more of these high-end malls to help with valuation, which is what Wall Street is looking at,” she says. “They want to increase their average store sales across the portfolio.”
However, she says because the owners are hoarding these properties, there won’t be many sales like this one. “You’re not seeing a lot of trophy malls offered, I think the only other one this year was the King of Prussia Mall deal,” Caldwell says. “You probably won’t see more sell like that this year.” In May, Lend Lease Group LLC announced it was selling a 50% interest in the King of Prussia Mall in Pennsylvania to Morgan Stanley Prime Property Fund for about $545 million.
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