Glimcher Completes $320M JV with Blackstone

With the closing of a joint venture transaction valued at $320 million, Columbus, Ohio-headquartered Glimcher Realty Trust now shares ownership of two of its shopping malls with New York-based The Blackstone Group.

March 31, 2010
By Barbra Murray, Contributing Editor

Courtesy Flickr Creative Commons user kevincole

With the closing of a joint venture transaction valued at $320 million, Columbus, Ohio-headquartered Glimcher Realty Trust now shares ownership of two of its shopping malls with New York-based The Blackstone Group. The deal allowed an affiliate of Glimcher to hold on to 40 percent of the properties through the joint venture, leaving the Blackstone affiliate to acquire a 60 percent interest in the partnership.

The joint venture involves the 1.5 million-square-foot Lloyd Center in Portland Ore., and the 1 million-square-foot WestShore Plaza in Tampa, Fla. Glimcher acquired Lloyd Center from SI-Lloyd Associates L.P. and LGM Partners for $167 million in 1998, and snapped up WestShore from Grosvenor Group Holdings Ltd. in 2003 for $152 million. Management and operations activities at the malls will continue to be handled by the retail REIT’s subsidiary, Glimcher Properties L.P.

The transaction between Glimcher and Blackstone, which netted Glimcher approximately $60 million, includes the joint venture’s assumption of the existing $215 million in Lloyd Center and WestShore. Glimcher used its proceeds from the deal to decrease its credit facility to $232 million. In a prepared statement, Michael P. Glimcher, Chairman of the Board and CEO of Glimcher, said the company’s new relationship with the investment and advisory firm “furthers our goal of raising additional capital now while positioning our mall platform for future potential growth as the economy recovers.”

Many of those who keep an eye on the retail REIT world see the deal as a good move for Glimcher. “It makes sense since it marries the operating capabilities of a large mall owner with the capital capacity of a sophisticated real estate investor,” Jim Sullivan, Managing Director with real estate research and consulting firm Green Street Advisors, told CPE.