Seritage Growth, Invesco Team Up for La Jolla Conversion Project
- May 24, 2018
Invesco Real Estate and Seritage Growth Properties have joined forces to own The Collection at UTC, an adaptive re-use of a recently-closed Sears store and auto center situated at Westfield UTC in La Jolla, Calif. The Collection at UTC is valued at about $165 million, including costs remaining to complete the project.
According to terms of the deal, Invesco acquired a 50 percent interest in the project from Seritage, which received proceeds of about $44 million and then utilized the funds to repay existing mortgage debt connected to the property.
“We are excited to expand our valued partnership with Invesco to create an upscale shopping, entertainment and dining experience at one of our premier assets, The Collection at UTC,” Benjamin Schall, Seritage’s president & CEO, said in a prepared statement. “We continue to utilize these types of partnerships to realize immediate value for Seritage shareholders, repay existing mortgage debt, and retain the significant longer term benefit as the redevelopments are completed.”
The Sears store was closed last year as part of the company’s major restructuring initiative. At the time, it was in the midst of a $585 million expansion. It has sat vacant ever since.
Terms of the joint venture show that the joined entity will invest, or pursue construction financing to fund, the additional money needed to convert the outdated property into 226,200 square feet of premium space. The goal would be to then lease the space to a collection of retailers and leading dining, entertainment and fitness concepts.
Invesco currently has $64.8 billion in real estate assets under management. Invesco teamed with Hines earlier this week to break ground of T3 West Midtown, a 230,000-square-foot office development in Atlanta.
Seritage is a REIT with 225 wholly-owned properties and 24 joint venture properties totaling nearly 39 million square feet of space across 49 states and Puerto Rico. In December, Seritage partnered with KDC to develop 1 million square feet of office space within the mixed-use redevelopment Dallas Midtown.
Image courtesy of Seritage Growth Properties