Aussie Firm to Sell Half Interest in King of Prussia Mall

Sydney-based Lend Lease Corp., a multi-national real estate investor and manager, has engaged Holliday Fenoglio Fowler L.P. to sell its 50 percent interest in the 2.6 million-square-foot King of Prussia Mall, in metro Philadelphia. John Pelusi, HFF’s executive managing director, along with Glenn Whitmore and Chris Turner, senior managing directors, will lead the sales team. Pelusi noted in a prepared statement that both the rollover of leases with below-market rents and the redevelopment of the former Strawbridge’s department store represent opportunities to continue to grow the mall’s revenue. Though Minnesota’s Mall of America is larger in total square feet, the King of Prussia Mall is actually slightly larger in terms of leasable area, making it the largest U.S. mall by that standard, according to a study by Eastern Connecticut State University. The King of Prussia Mall, anchored by Nordstrom, Neiman Marcus, Lord & Taylor, Bloomingdale’s, Macy’s, JCPenney and Sears, is also known for being one of the very few malls that can claim annual sales volume of over $1 billion. The mall is managed by Simon Property Group. The mall’s more than 400 stores and restaurants include more than 20 full-service restaurants, as well as three food courts. The mall is so large, in fact, that a dozen retailers have more than one location there, including Coach, Victoria’s Secret and The Body Shop. Just last week, Lend Lease announced the financial results of its fiscal year ending in June. Net operating profit rose 8.1 percent over 2007, from A$413.7 million to A$447.1 million, although because of inventory revaluations, statutory profit fell drastically, from A$497.5 million to A$265.4 million.