Macy’s has sold two buildings at Westfield Mission Valley mall in San Diego for $16.5 million. A full-line, 353,000-square-foot department store and nearby 5,500-square-foot building that houses a restaurant were included in the sale. Macy’s also operates a separate home store at Mission Valley, which wasn’t included in the transaction.
Westfield Mission Valley contains Bloomingdale’s, Marshall’s, Nordstrom Rack, Target and specialty stores such as Victoria’s Secret, Torrid, PacSun, Old Navy, Express and Jared the Galleria of Jewelry.
Macy’s said in February that it’s examining selling off full or partial stakes in some of its real estate. The retailer has been under pressure to leverage its property portfolio after a string of disappointing results. A Macy’s spokesman said the Westfield Mission Valley sale is not connected to any other deals. “This was a one-off opportunity to sell the building to Westfield and lease it back,” he said.
In January, Macy’s closed a $270 million deal to remake its Fulton Street store in Brooklyn, N.Y., which served up $100 million to renovate the location and also extended some tax benefits. Tishman Speyer will develop office space at the site.
In addition to closing stores — 36 doors will be shuttered this spring — the company has been selling off small pieces of its far-flung real estate holdings, ranging from a 16-acre mixed-use development site in New Hampshire to a building in downtown Pittsburgh. The company has also been considering partnership and joint ventures for both mall-based properties and flagship real estate assets in Manhattan, San Francisco, Chicago and Minneapolis.
Macy’s hired Eastdil Secured, a real estate-focused investment bank, to approach potential interested parties, with assistance from Credit Suisse and Goldman Sachs, about forming partnerships or joint ventures for the retailer’s mall-based properties, as well as Macy’s flagship real estate assets in Manhattan, San Francisco, Chicago and Minneapolis.
Macy’s has said that Tishman Speyer, which had been advising the retailer on real estate, has expressed interest in pursuing partnerships on the four flagship locations, so it will no longer be advising the company on those properties. Tishman Speyer will continue to advise Macy’s on potential opportunities for maximizing the value of other real estate its portfolio.
This year Macy’s closed a 140,000-square-foot unit at Irvine Spectrum in Irvine, Calif., and a 165,000-square-foot store at Country Club Plaza in Sacramento. A 136,000-square-foot store at Westfield Century City in Los Angeles closed in January and will be replaced with a larger store slated to open in spring 2017.