As part of its strategy to focus on flagship properties in major markets, Westfield Corp. has sold five U.S. malls, located in Connecticut, Illinois, California and Washington State, for $1.1 billion.
This sale, along with the November divestment of its mall in Carlsbad, Calif., is designed to reduce gearing — Westfield’s debt as a percentage of equity capital — by 3%.
“Proceeds from the transaction will initially reduce gearing and will be redeployed over time into our $11.4 billion development program,” said Westfield Co-CEO Peter Lowy in a statement. “Our investment program is almost entirely weighted toward our flagship assets with estimated development yields in the range of 7% to 8%.”
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The malls sold in the deal that closed Dec. 18, 2015 are:
• Connecticut Post, Milford, Conn.
• Fox Valley, Aurora, Ill.
• Hawthorn, Vernon Hills, Ill.
• MainPlace, Santa Ana, Calif.
• Vancouver, Vancouver, Wash.
The five malls were bought by an investor group consisting of a newly formed joint venture consisting of Centennial Real Estate Co., Montgomery Street Partners (an affiliate of Blum Capital Partners) and USAA Real Estate. Westfield will retain a 20% non-managing common equity interest. The Carlsbad mall was purchased by Rouse Properties for $170 million.
