GGP Arranges New Mortgages, Sells Two Non-Core Properties

Not long after outlining a plan for refinancing some of its debt over the next two years, as reported by CPN earlier this week, General Growth Properties has arranged three new mortgage loans on regional malls owned by the company in joint ventures. The Chicago-based REIT has also inked deals to sell two wholly owned office buildings. A five-year, $150 million interest-only loan with a fixed rate of 5.05 percent will replace an existing mortgage loan of about $108 million, and thus generate about $42 million of excess refinancing proceeds for the JV. Two other ten-year, fixed-rate loans totaling $181 million will replace existing loans of about $84 million, generating about $97 million of excess refinancing proceeds. The two loans will be interest-only for the first three years, and then will be based upon a 30-year amortization schedule for the remaining seven yearsAccording to the company, these sales are consistent with its “capital roadmap,” and it is currently negotiating with lenders regarding as many as 12 other new fixed-rate long-term mortgages on either JV or wholly owned assets. GGP expects to close most of these mortgage transactions by the end of the first quarter of 2008.The company has also inked a deal to sell two office properties it owns — a non-core asset class for the retail REIT — to an unspecified buyer for about $96 million, for a gain of about $38 million. GGP expects that deal to close by the end of this month.