CVS to close 200 drugstores in early first-quarter 2002
Due to the slowing economy, Woonsocket, R.I.-based CVS Corp. has decided to close 200 of its pharmacies in January 2002. The largest U.S. drugstore chain announced the closings on Oct. 30, following a 16% decline in third-quarter earnings.
CVS has not disclosed which locations it plans to shut down. The store closings will be spread throughout the company's portfolio, which consists of more than 4,000 stores in 32 states and the District of Columbia. CVS also plans to close one of its 10 distribution plants and one of two ProCare mail-order facilities.
Kimco Realty, GE Capital team up to target retail opportunities
New Hyde Park, N.Y.-based Kimco Realty Corp. and Stamford, Conn.-based GE Capital Real Estate have formed a $250 million joint venture named Kimco Retail Opportunity Portfolio to acquire established neighborhood and community shopping centers in the United States with high-growth potential. The initial funding for the venture consists of a shared equity pool established by the two partners, which is an 80-20 split. According to a GE Capital Real Estate spokesperson, the company provided $200 million, and Kimco contributed $50 million. Kimco will be responsible for the management and leasing of properties acquired by the joint venture.
Forest City buys California mall with funds from Tucson Mall sale
Cleveland-based Forest City Enterprises has acquired full interest in the Galleria at South Bay, a 955,000 sq. ft. regional mall in Redondo Beach, Calif., valued at $116 million. The company, which already held a 50% stake in the property, paid for the remaining 50% interest in the mall. The original developer of the mall, Forest City, sold a 50% stake in the mall in 1992 to Sacramento, Calif.-based California Public Employees' Retirement System (CalPERS). Located at Artesia and Hawthorne boulevards, the mall's anchor tenants include Nordstrom, Robinsons-May and Mervyn's.
The Galleria at South Bay is 96% leased and is producing sales of $400 per sq. ft. Forest City plans to renovate the shopping center, which opened in 1985.
In August, Forest City sold its 67.5% interest in Tuscon Mall, a 1.3 million sq. ft. regional mall in Tucson, Ariz., for $121.5 million. According to Charles Ratner, president and CEO of the company, that transaction resulted in an after-tax gain of $51 million and generated cash proceeds of $73 million, which were used to acquire the Galleria at South Bay through a tax-deferred exchange.
Northern California shopping center set for $105 million redevelopment
Newport Beach, Calif.-based developer Wattson Breevast LLC has unveiled plans for a long-awaited $105 million redevelopment of Tanforan Park Shopping Center in San Bruno, Calif., south of San Francisco. The 965,000 sq. ft. center, which opened in 1971, will be redeveloped into a 1.1 million sq. ft. super-regional mall, and will be renamed The Shops at Tanforan. Groundbreaking is expected to begin in the spring of 2002, with a grand reopening slated for the fall of 2003.
Located on El Camino Real at Interstate 380, the center is anchored by Sears, JCPenney and Target. The anchor tenants will remain open during the revitalization project. In addition to housing retailers and restaurants, the center will feature an entertainment component.
Los Angeles-based Altoon + Porter Architects LLP will design the plans for The Shops at Tanforan. The Whiting-Turner Contracting Co., based in Baltimore, will serve as contractor for the project.
‘Magic’ Johnson, Canyon Capital launch retail investment fund
Johnson Development Corp., a Beverly Hills, Calif.-based company founded by Earvin “Magic” Johnson of NBA fame, and Los Angeles-based Canyon Capital Realty Advisors LLC have formed a joint venture to launch a $300 million real estate investment fund called Canyon-Johnson Urban Fund LP. “The focus of this fund will be on U.S. urban opportunities, an area that we believe will be the focus of strong growth and value creation in the next 10 years,” said Bobby Turner, co-managing director of Canyon-Johnson Urban Fund. The partnership already has begun seeking investment opportunities.
For its initial investment, the Fund has teamed up with Milwaukee-based Boulder Venture to redevelop Capitol Court Shopping Mall located at 60th Street and Capitol Drive in Milwaukee. The $53 million project, which will be renamed Midtown Center, calls for the demolition of the existing mall and the construction of 606,000 sq. ft. of retail space anchored by a 150,000 sq. ft. Wal-Mart store. The center will feature national retailers, restaurants and entertainment components.