Daily market intelligence on mortgages, equity raising, investment sales, and CMBS.

Monday, 17 September 2012

GGP Looks to Short Sell Mall Near Orlando, Fla.

Written by 
Rate this item
(0 votes)

Commercial Real Estate Direct Staff Report

General Growth Properties Inc. is in the market to sell a financially-struggling regional mall with 1.1 million square feet in the Orlando, Fla., area.

Rockwood Real Estate Advisors has been tapped to market the property, the West Oaks Mall, which sits on 78 acres at 99401 West Colonial Drive in Ocoee, Fla., about eight miles from downtown Orlando. It will use the Auction.com platform to offer the property from Oct. 9-11.

The property's expected to sell for substantially less than the $64.8 million of debt that encumbers it. That debt, backed by the mall's 268,188 sf of inline space, is securitized through Wachovia Bank Commercial Mortgage Trust, 2003-C9. The debt has a 5.25 percent coupon and matures next August.

The debt is being handled by the CMBS trust's special servicer, CWCapital Asset Management, an affiliate of Rockwood. No payment has been made on it since May, according to servicer data compiled by Morningstar Credit Ratings.

GGP, a Chicago REIT, holds title to the property, but has agreed to surrender it to the trust in lieu of foreclosure.

The offering includes all of the inline store space; two anchor tenant spots with 368,720 sf; 61,847 sf of outparcel space; and three development parcels with nine acres on the mall's periphery. The anchor spots include a 223,813-sf store that is vacant and 144,907 sf occupied by a Sears's store.

The Sears store was among 11 that Sears sold to GGP earlier this year because it had been planning to vacate the locations. But it's not certain whether the retailer will vacate the West Oaks Mall.

The offering does not include the mall's other anchor spots, a 195,075-sf store occupied by Dillard's and 95,994 sf occupied by JCPenney.

The inline space is about 70 percent occupied, but several tenants are on very short-term leases. Its occupancy level, which was 96.4 percent when the loan was issued, nosedived after the national economy plummeted in 2008 and hasn't recovered.

In addition to the loss of many smaller inline tenants, the property also lost tenants that had occupied its outparcels. Those include Border's Books, which filed for bankruptcy in 2010, Chevy's restaurant and Toys R Us.

GGP, in a joint venture with the New York State Common Retirement Fund, had developed the mall in 1996. In 2007, it bought out the pension fund's stake in the venture, known as GGP/Homart I, which was also invested in 21 other malls.

Morningstar has speculated that West Oaks Mall could be sold for about $35.6 million, which would result in a loss of $27 million to $28 million to the CMBS trust. However, people familiar with the property believe it would struggle to fetch as much as $20 million.

Rockwood, of New York, is pitching the offering as a value-add opportunity. The property's marketing material notes that two anchor posts being offered are contiguous, which would give a new owner latitude in reconfiguring the space to meet the needs of prospective tenants.

The mall's inline tenants include Victoria's Secret, Bath & Body Works, Finish Line, Hollister and Champs, along with a 14-screen AMC theater that generates more than $313,000/screen in annual sales.

Comments? E-mail John Covaleski or call him at (267) 247-0112, Ext. 208.



CREDirect Logo
Authoritative, timely and unbiased market intelligence trusted by the most active players in the commercial real estate space.

Experience CREDirect for just $25!

Who is buying, Who is selling, Who is raising capital, Where it is being invested, How deals are being financed
  • Every business day we identify investment, lending and trading opportunities.
  • Subscribers have full access to more than 13 years of CMBS data including our CMBS Pricing Matrix, which allows you to keep track of pricing trends for generic CMBS, and our CMBS Databases, with key data points on every domestic CMBS deal issued since 2000.
  • With a searchable archive of more than 90,000 articles going back to 1999 and a property sales database with more than 13,500 tranactions, each valued at more than $10 million, CREDirect is an extremly powerful research tool.
  • User-customized email alerts allow you to choose criteria that you are particularly interested in and receive email alerts when we publish articles that match your interests. Alerts are based on: City, State, Sector, Subject, Company, Valuation or CMBS Deal Name.

Additional Info

  • Syndicate to Realpoint: No
  • Cities: Orlando
  • States: Florida
  • Sector: Retail
  • Subject: Property Offerings (OFF)
  • Company: General Growth Properties
  • Private: No
Read 223 times Last modified on Thursday, 20 September 2012

Data Digest

 

CMBS Deliquency Volume

dqdataFP1

 

CMBS Special Servicing Volume

sschartfp

Top Bookrunners
Private-Label CMBS

1H2014

Investment Bank

#Deal

Bal $mln

Mkt
Shr%

Deutsche Bank

16.0

12,761.50

32.44

JPMorgan

6.10

4,856.29

12.35

Wells Fargo

8.11

4,790.00

12.18

Citigroup

4.33

3,750.65

9.54

Goldman Sachs

4.00

3,722.62

9.46

 

Moody’s/RCA CPPI

cppichartAFP

 

CMBS Pricing Matrix (Legacy AAA Spreads)

AAAspreadsFPa

 

Top Loan Contributors
Domestic, Private-Label CMBS - 1H2014

Lender

Vol $mln

Mkt
Shr%

Deutsche Bank

8,118.01

20.87

JPMorgan

4,486.83

11.53

CCRE

3,064.41

7.88

Citigroup

2,779.70

7.15

Goldman Sachs

2,604.85

6.70

 

 

 

half-page-ad

warehouse-backstage