Westfield America Trust expands U.S. portfolio: acquires Fashion Square Sherman Oaks in joint venture with Prudential plc
24 December 2002
Countries: United States
Following the announcement in October, Westfield America Trust (ASX: WFA) announced today that it has completed the transaction to acquire a 50% interest in Fashion Square Sherman Oaks for US$67 million from a U.S. affiliate of the United Kingdom’s Prudential plc.
Simultaneously, a U.S. affiliate of Prudential plc has acquired a 25% interest in Westfield America’s Garden State Plaza with a value of $193.8 million, consisting of US $128.8 million in cash and US$65.0 million in mortgage debt on Garden State Plaza.
A U.S. affiliate of Prudential plc will acquire a further 15% interest in Garden State Plaza for US$116.3 million between May 2004 and May 2005 for a combination of cash and mortgage debt. It also has an option to acquire up to an additional 10% interest for US$77.5 million, which is exercisable between May 2004 and May 2005, for a combination of cash and mortgage debt.
Westfield’s Managing Director, Peter Lowy, said the company was pleased with the transaction and with the opportunity to joint venture with Prudential plc. “The addition of Fashion Square Sherman Oaks to the portfolio increases Westfield America’s presence in the Los Angeles market to twelve centres, fits well with our growth strategy and provides outstanding market synergies,” Lowy said.
Nick Thompson, head of fund management for Prudential plc’s real estate group in London, echoed Mr. Lowy’s enthusiasm. “Prudential plc is very pleased with partnering with Westfield America. Westfield brings great leasing and property management expertise to Fashion Square as well as significant and meaningful scale to the Los Angeles marketplace. This transaction also provided the opportunity for Prudential plc to geographically diversify our U.S. retail investment in one of the major fortress malls in the New York area,” Thompson said.
Fashion Square Sherman Oaks is a two-level regional mall located on the 101 (Ventura) Freeway in Sherman Oaks, California, a suburban area in the heart of the San Fernando Valley. The center currently encompasses approximately 848,000 square feet of Gross Leasable Area (GLA), with approximately 120 specialty shops and is anchored by Bloomingdales and Macy’s.
Westfield Shoppingtown Garden State Plaza is a premiere two million square foot super-regional mall located in Paramus, New Jersey, and is anchored by Nordstrom, Macy’s, JCPenney, Neiman Marcus and Lord & Taylor. It was built in 1957 and acquired by Westfield in 1986, with its latest expansion completed by Westfield in 1996, including the addition of Lord & Taylor, Neiman Marcus and 235,000 square feet of specialty store space. Goldman Sachs & Co. advised Westfield America in this transaction, and J.P. Morgan Fleming Asset Management advised Prudential plc.
Westfield America Trust (ASX: WFA) is the 2nd largest property trust listed on the Australian Stock Exchange. WFA owns a majority interest in the Westfield America portfolio of 62 centres, branded as Westfield Shoppingtowns. Westfield Shoppingtowns are home to more than 8,400 specialty stores in California, Colorado, Connecticut, Florida, Illinois, Indiana, Maryland, Missouri, Nebraska, New Jersey, New York, North Carolina, Ohio and Washington.
Prudential plc is the public holding company of one of the largest life insurance companies in the United Kingdom and a leading financial services group with operations in Europe, Asia and the United States (not affiliated with Prudential Financial.)
This statement may contain certain “forward-looking statements” with respect to certain of Prudential’s plans and its current goals and expectations relating to its future financial condition, performance and results. By their nature, all forward-looking statements involve risk and uncertainty because they relate to future events and circumstances which are beyond Prudential’s control including among other things, UK domestic and global economic and business conditions, market-related risks such as fluctuations in interest rates and exchange rates, the policies and actions of regulatory authorities, the impact of competition, inflation, deflation, the timing, impact and other uncertainties of future acquisitions or combinations within relevant industries, as well as the impact of tax and other legislation and other regulations in the jurisdictions in which Prudential and its affiliates operate. As a result, Prudential’s actual future financial condition, performance and results may differ materially from the plans, goals and expectations set forth in Prudential’s forward-looking statements.