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Wednesday, 03 August 2016

Macerich Lining up $750Mln of Debt Against 3 Malls

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Commercial Real Estate Direct Staff Report

Macerich Co. is in the process of lining up about $750 million of financing against three malls in California and Indiana.

The properties are: the Eastland Mall, with about 1 million sf at 800 North Green River Road in Evansville, Ind.; Fashion Fair, with 963,000 sf at 645 East Shaw Ave. in Fresno, Calif., and Village at Corte Madera, with 460,000 sf at 1618 Redwood Highway in Corte Madera, Calif.

The Eastland and Fashion Fair properties are unencumbered, while Village at Corte Madera serves as collateral for a $74 million loan from Metropolitan Life Insurance Co. that matures in November and pays a coupon of 7.27 percent.

"The financing market for high-quality regional malls remains very good," explained Thomas O'Hern, Macerich chief financial officer, speaking during the earnings call on Monday.

For instance, Macerich has received bids from eight investments banks interested in providing about $350 million against the Fashion Fair property, which is 94.5 percent occupied. Its inline tenants generated $675/sf in sales during the 12 months that ended June 30, up from $617/sf a year earlier.

The loan is expected to have a 10-year term. "We're getting some very, very strong quotes," O'Hern said.

Meanwhile, Macerich expects to close on a $225 million loan from a life insurance company against the Village at Corte Madera. The 12-year loan will pay a coupon of 3.5 percent.

Corte Madera's inline tenants generated sales of $1,498/sf during the 12 months through the end of June, when the property was 89.1 percent occupied. That compares to $1,316/sf a year earlier, when the property was 97.3 percent occupied.

Macerich bought the property in 1998 for $120 million and five years later sold a 49.9 percent stake to the California Public Employees' Retirement System. The property is anchored by a Nordstrom and Macy's and includes inline retailers such as Kate Spade, Lululemon, Apple and Microsoft.

The REIT will be looking to line up a $175 million loan against the Eastland Mall, which until last December had been encumbered by a $168 million CMBS loan that was paid off, six months before its maturity.

Inline tenants at the 38-year old property generated $377/sf of sales for the 12 months through the end of June, which compares with $370/sf in sales a year earlier.

The mall was 95.9 percent occupied in June, up from an occupancy level of 92.8 percent in June 2015. In 2014, the last full year for which data are available, the property generated $14.1 million of net cash flow.

Comments? E-mail Josh Mrozinski or call him at (267) 247-0112, Ext. 213.



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  • Syndicate to Realpoint: No
  • Sector: Retail
  • Subject: Mortgages/Financing (MOR), REITS -general (REITS)
  • Valuation: More than $150 million
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Data Digest

 

CMBS DELINQUENCY VOLUME

dqdataFP1

 

CMBS SPECIAL SERVICING VOLUME

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Top Bookrunners Domestic, Private-Label CMBS - 2017
Investment Bank #Deals Vol$mln MktShr%
Goldman Sachs 17.59 11,819.34 13.68
JPMorgan Securities 14.52 10,968.11 12.70
Citigroup 12.04 10,012.71 11.59
Wells Fargo Securities 14.02 9,936.06 11.50
Deutsche Bank 12.55 9,879.74 11.44

 

RCA CPPI

 

cppichart FP

 

 

CMBS 2.0 Spreads

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Top CMBS Loan Contributors - 2017
Lender #Loans Vol$mln MktShr%
Goldman Sachs 146.89 11,719.34 13.63
JPMorgan Chase Bank 117.68 10,114.14 11.76
Deutsche Bank 198.48 9,689.97 11.27
Morgan Stanley 166.18 8,539.78 9.93
Citigroup 199.05 8,088.24 9.41

 

 

 

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