Macerich, the Santa Monica, Calif.-based developer, and the Alaska Permanent Fund Corp. have acquired The Shops at North Bridge on "The Magnificent Mile" in Chicago for $515 million.
The deal marks Macerich's entry into Chicago, and adds another high-profile property to the company's portfolio, which also includes Tysons Corner Center in Virginia, also co-owned by APFC, as well as Santa Monica Place in Los Angeles, which is slated for a major redevelopment, and Queens Center in New York.
The Shops at North Bridge is a 680,933-square-foot, mixed-use retail development on the south end of "The Magnificent Mile" on Michigan Avenue. The four-level center is anchored by Nordstrom and houses about 50 smaller specialty stores, 20 restaurants and five hotels. The transaction includes two parking garages with a combined 1,200 spaces and 133,615 square feet of office space just west of the center.
Macerich will spend more time examining the property to determine any possible changes, but none is planned yet, a company spokeswoman said.
"A clear point of differentiation for Macerich is our focus on cultivating the very best properties in optimal, high-performing markets throughout the country," Macerich's chief investment officer Edward C. Coppola said in a statement. "Within our national portfolio, we have a dominant presence in many of the nation's top markets — including Los Angeles, metropolitan New York, Phoenix, the San Francisco Bay Area and Washington, D.C. The Shops at North Bridge gives us an opportunity to enter Chicago with what we believe is the best retail location in this desirable market."
Macerich and APFC acquired The Shops at North Bridge from a partnership comprising The John Buck Co., the Morgan Stanley real estate funds and Westfield Group. Macerich and APFC assumed the $205 million balance from a loan with a 4.67 percent interest rate and maturing in July 2009.
"We're very confident that Macerich will continue our vision for this world-class asset," said John O'Donnell, president and chief operating officer, The John Buck Co.
Macerich, a real estate investment trust, said the small specialty shops in the center of 10,000 square feet or less average $839 in sales a square foot. The center is 94.9 percent leased, Macerich added.The acquisition of The Shops at North Bridge caps a busy period for Macerich, which opened six redevelopments and new projects in 2007.
Dallas-based L&B Realty Advisors, a commercial real estate investment management organization, arranged the deal.
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