Mall owner Macerich Co. MAC.N said on Friday it agreed to buy Westcor Realty Limited Partnership for $742 million in cash and securities in a move to strengthen its position as a mall developer in the West.
The Westcor malls will allow the Santa Monica, California-based real estate investment trust add productive malls that are the leaders in their markets, said James Sullivan, senior real estate analyst at Prudential Securities.
'There are a couple of important things that Macerich got here that they wanted,' Sullivan said. 'These are malls that are fairly dominant in their market.'
Macerich will acquire eight malls in Arizona, including six in the Phoenix area, and one in Colorado. The Phoenix area is one of the fastest growing markets in the country, Macerich said, with strong demand and a low vacancy rate.
Macerich said it will assume $733 million of Westcor debt, and issue about $80 million of securities known as convertible preferred operating units, which will carry a conversion price of $36.55 and a 9 percent dividend on an as-converted basis. It will pay for the rest in cash.
(source: Reuters)
