UPDATE 1-Taubman says first-quarter tenant bankruptcies up

(Adds dateline, expands tenant bankruptcies, Macao deal and mall sale)

By Ilaina Jonas

NEW YORK, April 23 (Reuters) - Luxury mall owner Taubman Centers Inc (TCO.N) said on Wednesday that leases affected by tenants who went into bankruptcy reached its highest first-quarter level since 2004.

About 0.9 percent of Taubman's leases went into bankruptcy in the first quarter, Chief Executive Robert Taubman said on a conference call with analysts.

"Just because a lease goes into bankruptcy does not mean that a specific store will close," he said. "In fact, about 30 percent of those stores that went into bankruptcy in 2007 remain open today in our centers."

Over the past six years, the first quarter has accounted for 50 percent to 75 percent of the leases held by companies that filed for bankruptcy protection, Taubman said.

Since the company became publicly traded about 15 years, the level of leases affected by tenant bankruptcies has ranged from 0.4 percent to 4.5 percent annually.

"That would suggest that even in this economy that we're dealing with, even with some of the struggling tenants that we have, that this is not going to be an off-the-charts record year for bankruptcies," Taubman said.

Taubman has looked to Asia to grow outside of the United States. The CEO said shareholders in Hong Kong-based eSun Holdings Ltd (0571.HK), one of its partners in the retail portion of Macao Studio City, a casino, hotel, retail and entertainment center in Macao, have approved Taubman's involvement.

In February, Taubman said it would acquire a 25 percent interest in The Mall at Studio City. The Bloomfield Hills, Michigan-based company plans to invest $200 million in the project and realize a 10 percent aftertax return.

"Earlier this year, our partners moved their financing efforts from the U.S. to Asia, where banks are less constrained," said Taubman.

He expects the $1.3 billion financing to be fully subscribed and completed over the next two to three months.

The project is likely to open in spring 2010, Taubman said.

Taubman also confirmed it plans to sell Stamford Town Center, a mall it owns jointly with a fund managed by UBS AG (UBSN.VX), which pressed for the sale.

"They have been a partner of ours, I want to say for eight or 10 years," Taubman said. "This is the normal turning over of their portfolio, which would happen in any kind of a pool of capital like this." (Reporting by Ilaina Jonas; editing by Jeffrey Benkoe)