LOMBARD, IL-A partnership of New York City-based Kohlberg Kravis Roberts & Co. LP and El Segundo, CA-based YTC Pacific has purchased the 1.5-million-square-foot Yorktown Center for $196 million. The seller is the family of the late Ed Pehrson, who built the massive mall in 1968.
The mall, ranked the largest mall in the United States when it opened, has been through a number of changes and redevelopments over the years, but continues to be one of the most popular retail destinations in the suburbs of Chicago. The 150 stores include AMC Theaters, JCPenney, Carson Pirie Scott, Von Maur, the Gap, Victoria’s Secret and American Eagle. There are a number of popular restaurants, and the former Montgomery Ward spot was redeveloped into the successful Shops on Butterfield lifestyle center in 2007, with tenants such as HomeGoods, Marshalls, the Sports Authority and Lucky Strike Lanes.
In a KKR statement, the company says the mall does more than $280 in annual revenue. “Through a combination of proactive management, a focus on leasing, cosmetic and other improvements, we aim to add value to the center with the hope of offering a more pleasant and practical shopping experience for residents,” said Ralph Rosenberg, a member of KKR and head of the firm’s new Real Estate group. This is the first retail investment for KKR.
He said the property is 85% leased. “We believe that there are a number of near and long-term improvements that will help make this happen,” Rosenberg said. “For example, some of our immediate initiatives include upgrading the lighting, signage, food court and the entrances. Over the long-term, we will also look at ways to improve the tenant and merchandising mix. Our goal in all of these endeavors will be to benefit the surrounding community and the local economy.”
Partner YTC will manage day-to-day operations of Yorktown. Jones Lang LaSalle is the leasing agent. YTC is a partnership of Pacific Retail Capital Partners, Collarmelle Partners and Peter Fair with Continuum Partners.
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