Macerich seeks to sell malls with lower sales rating - sources

NEW YORK Fri Dec 7, 2012 4:08pm EST

NEW YORK Dec 7 (Reuters) - Macerich Corp has put 17 non-core malls on the block, according to sources familiar with the matter, a move already taken by other mall owners selling centers producing lower sales.

The properties are so-called Class B malls, as opposed to Class A, which differ based on the sales per square foot the specialty store tenants generate.

Fourteen of the malls are wholly owned by Macerich and average about $321 per square foot, according to marketing documents obtained by Reuters. Those malls, being marketed by Eastdil Secured, include 11.1 million square feet of leaseable space.

The larger real estate investment trusts have been trying to weed out their lower performing malls as the gap between malls with the highest sales per square foot has been widening with the others. Stock investors tend to pay a premium for companies with higher quality malls.

Most of the Macerich malls up for sale are more than 90 percent leased. Great Northern Mall in Clay, New York is the only exception, being 81.9 percent leased. At the other end of the spectrum, The Centre at Salisbury, in Salisbury, Maryland, is 98.5 percent leased.

Jones Lang LaSalle Inc is marketing two others -- Kitsap Mall in Silverdale, Washington, and Cascade Mall in Burlington, Washington. The company also is selling Ridgemar Mall in Fort Worth, Texas. Macerich owns roughly half of each of those three malls.

Green Street Advisors defines A malls as generating at least $450 per square foot, A-minus malls as generating $430 per square foot and Class B malls as generating at least $350 per square foot.

In January, General Growth Properties Inc spun off 30 mostly lower performing malls into a separate real estate investment trust called Rouse Properties Inc. In April, Westfield Group sold a 90 percent stake in six of 17 Class B malls it had on the market to Starwood Capital Group. The roughly $1 billion sale also included one Target anchored shopping center. It also sold another mall for $147 million.

The other malls being marketed by Eastdil Secured are South Towne Center in Sandy, Utah; Rimrock Mall in Billings, Montana; Northridge Mall in Salinas, California; Capitola Mall in Capitola, California; Chesterfield Town Center in Richmond, Virginia; Valley Mall in Harrisonburg, Virginia; NorthPark Mall in Davenport, Iowa; SouthPark Mall in Moline, Illinois; Green Tree Mall in Clarksville Indiana; Towne Mall in Elizabethtown, Kentucky; Rotterdam Square in Schenectady, New York and Wilton Mall in Saratoga Springs, New York.

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