Washington Prime Group Inc. has signed a definitive agreement for the sale and leaseback of four assets. Under the agreement, an affiliate of Perennial Investments & Advisors LLC, an institutional fee investor, will acquire a fee interest in the land at the Properties for a price of approximately $98.9 million.
Concurrently, Washington Prime Group will enter into a new 99-year master ground lease for a leasehold interest in the land at the Properties. The company will, however, continue to own a fee interest in the improvements through the term of the aforementioned master ground lease and continue to manage, lease and develop the properties, offering the same exceptional guest experience.
Lou Conforti, CEO and Director stated: “We continue to prove our ability to access attractive capital to satisfy our redevelopment program whether via traditional or more creative means. This serves as a testament to our commitment to become the leading landlord of dominant town centers situated within secondary catchments.”
Conforti added, “This transaction with Perennial illustrates our ability to arbitrage the unproductive land component of an asset by securing long term (30 year) capital at an attractive interest rate while still maintaining operational and financial control. When combined with the two previously announced outparcel transactions with Four Corners Property Trust, WPG has sourced approximately $206M in new strategic capital which satisfies approximately 40% of our previously announced department store repositioning plan.”
The Properties, which represent an aggregate 3.9M square feet of productive retail space, are: Edison Mall, located in Fort Myers, Florida; Great Lakes Mall, located in Mentor, Ohio; Irving Mall, located in Irving, Texas; and Jefferson Valley Mall, located in Yorktown Heights, New York.
The company expects to complete the sale leaseback transaction in the second half of 2019, subject to due diligence and customary closing conditions.
Washington Prime Group Inc. is a retail REIT and a recognized leader in the ownership, management, acquisition and development of retail properties.