Wednesday, January 27, 2016

PREIT Selling Four Malls In Three States

Pennsylvania Real Estate Investment Trust (PREIT) has received deposits on the sale of four malls under contract as part of the Philadelphia-based REIT's plan to raise up to $225 million by the middle of next year by disposing of non-core and underperforming assets.

PREIT announced that it has received the non-refundable deposits on a sale agreement for Gadsden Mall and Wiregrass Commons Mall, in Gadsden and Dothan, AL; and New River Valley Mall in Christianburg, VA; which are being sold as a three-property package to an institutional buyer for $95.4 million, as well as a separate agreement for the sale of Palmer Park Mall in Easton, PA.

PREIT is also negotiating a contract for the sale of two Center City properties, 1501-05 Walnut St. and 1520-22 Chestnut St., and is under contract to sell a land parcel in Gainesville, FL, scheduled to close mid-2017, according to an investor presentation. The mall operator is also marketing the Lycoming Mall in Pennsdale, PA and Washington Crown Center in Washington, PA.

Sale terms for the transaction will be released upon closing. The three-mall package, Palmer Park Mall and Center City retail properties are expected to close in the first half of 2016, while the sales of Lycoming Mall and Washington Crown Center are expected to close in the second half of the year. The Florida land expected to be final in the first half of 2017.

In total, the REIT expects to raise $220 million to $225 million in proceeds from the transactions.

The dispositions have been a top priority allowing PREIT to recycle capital into higher-quality assets, said CEO Joseph F. Coradino. The company has sold interests in 20 assets, including eight non-core malls with sales of less than $250 per square foot, over the last three years with a total value of over $480 million.
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