Santa Monica, Calif. — The Macerich Company (NYSE: MAC) has closed on the first of three joint ventures in the shopping center sector.
The company had previously announced it would form these ventures to contribute interests in eight regional malls, totaling about $2.3 billion.
This first joint venture will allow GIC to acquire a 40 percent interest in Lakewood Center in Lakewood, Calif.; Los Cerritos Center in Cerritos, Calif.; South Plains Mall in Lubbock, Texas; and Washington Square in Portland, Ore.
The cash proceeds to Macerich total $1.5 billion. This includes $964 million in excess loan proceeds.
Macerich also expects to close the additional two joint ventures in January. These include a second joint venture with GIC on Arrowhead Towne Center in Glendale, Ariz., as well as a joint venture with Heitman on Deptford Mall in Deptford, N.J.; FlatIron Crossing in Broomfield, Colo.; and Twenty Ninth Street center in Boulder, Colo.
The firm’s board of directors also declared two special dividends, each $2 per share of common stock. The first dividend is payable on Dec. 8, 2015, to stockholders of record at the close of business on Nov. 12, 2015. The second dividend is payable on Jan. 6, 2016, to stockholders of record at the close of business on Nov. 12, 2015.
Macerich recently announced its total revenue for the third quarter was $326.3 million, up 23.8 percent from the third quarter of 2014. The earnings results were released after the market closed on Tuesday, Oct. 27.
The company’s tenant reimbursement for the third quarter was $106.3 million, up 18.1 percent from a year ago. Macerich’s income also grew by 36.4 percent compared to the third quarter of last year.
“It was another very strong quarter for us,” said Tom O’Hern, Macerich’s CFO, during a recent earnings conference call. “We continued to see the benefit in our operating results of the major portfolio transformation we’ve been through the past three years, including the sale of 15 lower productivity malls, and the redeployment of that capital into more productive, faster-growing assets. Leasing spreads were good again this quarter, and we saw good deal volume.”
The management team also noted during the conference call that Macerich had signed about 265,000 square feet of leases involving spaces of less than 10,000 square feet. The average re-leasing spread for the 12-month period was 16.3 percent on a cash basis. Mall occupancy was at 95.4 percent, slightly down from one year ago.
Macerich is a publicly traded real estate investment trust (REIT) that focuses on the acquisition, leasing, management, development and redevelopment of regional malls throughout the United States. It currently owns 55 million square feet of real estate, with its primary interests in 51 regional shopping centers.
The Santa Monica-based REIT’s stock price closed Friday, Oct. 30, at $84.74 per share, up from $66.99 per share a year ago.
GIC is a leading global investment firm with more than $100 billion in assets under management. Established in Singapore in 1981, where it manages the country’s foreign reserves. GIC employs more than 1,200 people across 10 offices worldwide.
Founded in 1966, Heitman is a global real estate investment management firm with more than $34.5 billion in assets. The Chicago-based company has offices in Los Angeles, London, Luxembourg, Dusseldorf, Munich, Warsaw, Hong Kong, Tokyo and Melbourne.