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Joint Venture Recapitalizes Streets at Southglenn

PCCP LLC, Alberta Development Partners LLC and Walton Street Capital LLC announced the $300 million recapitalization of all of the indebtedness of the The Streets at SouthGlenn, in Centennial, Colo. This recapitalization provides the new venture with significant working capital to build upon the success already achieved at the property.

According to Phil Russick, principal at PCCP, “The recapitalization of this challenging situation is one of PCCP’s core strengths. Over the past six months, we have spent countless hours securing the cooperation of multiple lenders in a bank group to acquire the indebtedness and reinforce the capital structure of this investment. We are now looking forward to stabilizing this core irreplaceable property with continuity in strategy and ownership, along with our partners Alberta and Walton Street.” PCCP’s San Francisco team, including Russick, executed and managed The Streets at SouthGlenn transaction.

The Streets at SouthGlenn is an open-air town square-style retail, entertainment, commercial and residential property. A redevelopment of the former SouthGlenn Mall, the Streets at SouthGlenn consists of approximately 580,542 square feet of retail use, 137,010 square feet of office and 202 apartment units.

Along with this recapitalization, the venture announced a 10-year lease with Pearson, an education, technology and services provider. Pearson’s eCollege business will occupy three floors totaling 96,027 square feet of space of the Silver LEED certified, five-story class-A office space.

The Streets at SouthGlenn will soon welcome University of Phoenix, Snooze – an AM eatery, Shine Boutique, Just Pets, Edible Arrangements, Dairy Queen, Smooch the Pooch – A pet boutique, Pearl Vision and Cheers. In addition, two large restaurants will open their doors with early summer openings in June including Hodson T’s and Cantina Laredo – a gourmet Mexican food eatery.

CBL Announces More Than $298M in Financing Activity

CBL & Associates Properties Inc. announced $298.8 million in non-recourse financing activity at a combined estimated weighted average interest rate of 6.58 percent. The company closed or entered into agreements to close five separate non-recourse loans including one new loan and the refinancing of four existing loans, generating total net proceeds of $51.5 million, after repayment of the existing loans.

The Company closed a new $14.8 million loan secured by The Terrace, an associated center in Chattanooga, Tenn. The 10-year loan bears a fixed interest rate of 7.25 percent. CBL also closed an eight-year $115.0 million loan secured by CoolSprings Galleria in Nashville, with a fixed interest rate of 6.98 percent. The loan replaced the existing $126.9 million loan, which was scheduled to mature in September 2010.

CBL closed two separate 10-year, CMBS loans including an $83.0 million loan secured by Burnsville Center in Minneapolis and a $21.0 million loan (representing CBL’s 50 percent share) secured by Parkway Place in Huntsville, Ala. CBL also entered into an agreement for a 10-year, $65.0 million non-recourse CMBS loan secured by Valley View Mall in Roanoke, Va., which is expected to close within 30 days with an estimated interest rate of 6.5 percent.

The loan secured by Burnsville Center bears a fixed interest rate of 6.0 percent and the loan secured by Parkway Place bears a fixed interest rate of 6.5 percent. These loans will replace three existing loans secured by these properties, aggregating $126.8 million that were scheduled to mature in 2010.

Shoppes at Chino Hills Changes Hands in $94.5M Retail REO

The Orange County and Los Angeles offices of Holliday Fenoglio Fowler L.P. (HFF) announced that the sale of the 388,000-square-foot The Shoppes at Chino Hills in Chino Hills, California.

Chino Hills Mall LLC acquired the property for $94.5 million free and clear. The center was completed in May 2008 by Opus West in a project that cost more than $130 million and features more than 60 tenants set within an open-air center along landscaped streets with store-adjacent parking. Opus West filed for bankruptcy in 2009 at which point a bank-led consortium took control of the property.

The acquisition provides new capital to the project. The Shoppes at Chino Hills is managed by PM Realty Group and leased by CB Richard Ellis. The center is 87 percent leased.

The HFF investment sales team was led by senior managing director Ryan Gallagher and directors Kelly Rohfeld, Bryan Ley and John Crump, who marketed the property on behalf of the sellers, a bank consortium group led by Bank of America. A private Southern California-based investment group purchased the property on a free and clear basis for $94.5 million.

Inland Forms JV with Dutch Pension Fund

Inland Real Estate Corp. formed a new joint venture with PGGM, a Dutch pension fund administrator and asset manager, to acquire up to $270 million of grocery-anchored and community retail centers in Midwest U.S. markets.

Upon the initial closing, PGGM will contribute $20 million of equity and Inland Real Estate Corporation will contribute three retail centers with an approximate gross equity value of $45 million to the joint venture.

The three Inland contributed properties include the 97,638-square-foot Shannon Square Shoppes in Arden, Minn., the 82,929-square-foot Mallard Crossing in Elk Grove Village, Ill., and the 170,122-square-footWoodland Commons in Buffalo Grove, Ill.

Inland Institutional Capital Partners Corp. served as Inland Real Estate’s adviser on this transaction. Jones Lang LaSalle assisted PGGM for property due diligence on contributed IRC properties.

Forest City Announces Permanent Financing for East River Plaza

Forest City Enterprises Inc. announced that a subsidiary has closed on the conversion of the construction facility for the East River Plaza retail center in Manhattan, to a $214.3 million ($107.2 million at the Company's pro-rata share) term loan.

The conversion to permanent financing, with maturity in January 2019, is through the same lender group that provided construction financing for the center. The loan carries an effective all-in fixed interest rate of less than 4.5 percent. The major financial terms of the conversion were negotiated in conjunction with the initial construction loan. Coupled with the conversion of the construction loan, the existing $40 million credit enhancement in tax-exempt Empowerment Zone bonds has also been extended to the 2019 maturity date. In addition to conventional bank financing, the center was made possible by financing provided by the State of New York, New York City and the Upper Manhattan Empowerment Zone.

East River Plaza is a 527,000-square-foot retail center built on the site of the former Washburn Wire factory in Harlem. The factory stood vacant since the early 1980s prior to the beginning of work on the retail center. The site was initially acquired by Blumenfeld Development Group Ltd., a full-service real estate development firm with core strengths in big-box retail and office space.

In November 2009, Costco became the first tenant to open at East River Plaza. Since then, Best Buy also opened, and additional tenants, including Target, Marshall's, PetSmart, Old Navy, Bob's Furniture and GameStop are expected to open this summer. The center is currently 93 percent leased.

Trademark Property Acquires Two Centers

Trademark Property Co., in partnership with a private equity fund, announced the acquisition of two regional mall properties in Santa Fe, N.M., and Westland, Mich.

Santa Fe Place and Westland Shopping Center were acquired in May by a private fund, which has engaged Trademark as the manager and development partner. Trademark will direct remerchandising and redevelopment efforts at the 571,238-square-foot Dillard’s-, JCPenney- and Sears-anchored Santa Fe Place property, which is Northern New Mexico’s only regional mall. The new investment group is committed to revitalizing the mall and has secured funds for the redevelopment.

Westland Shopping Center, a 1,063,722-square-foot regional mall located on the west side of the Detroit Metro Area, is anchored by Macy’s, Kohl’s, Sears and JCPenney.

HFF Secures $40M Refinancing in Southern California

The San Diego office of HFF secured a $40 million refinancing for Solana Beach Towne Centre, an approximately 250,000-square-foot, class-A community shopping center in Solana Beach, Calif.

Working exclusively on behalf of American Assets Inc., HFF senior managing director Tim Wright and associate directors Zack Holderman and Rob Hinckley placed the 10-year, sub 6 percent fixed-rate loan with Deutsche Bank Mortgage Capital LLC. Loan proceeds are retiring an existing CMBS loan.

Solana Beach Towne Centre has 12 Mediterranean-style buildings situated on a 23-acre multi-district site. The property is 97 percent leased to tenants including Henry’s Marketplace, CVS Pharmacy, Marshalls, Staples, Panera Bread and Starbucks.

Other Notable Deals

Excel Trust Inc. acquired five properties, bringing the total to 10 properties acquired since its initial public offering on April 23, 2010. The company acquired a 53,411-square-foot Shop ’n Save in Ballwin, Mo., for $8.45 million at an approximate cap rate of 8.72 percent. It bought a 51,762-square-foot Jewel Osco in Morris, Ill., for $8.15 million at an approximate cap rate of 8.10 percent. It purchased a 13,650-square-foot Walgreens in Barbourville, Ky., for $4.21 million at an approximate cap rate of 8.0 percent. It also bought two Walgreens in Corbin, Ky. For a combined $7.60 million at an approximate cap rate of 8 percent.

TNP Strategic Retail Trust Inc. announced the acquisition of the 170,275-square-foot Waianae Mall, a 92 percent occupied multitenant retail center, in Waianae, Hi., for $25.7 million. The purchase included assuming a 5.4 percent fixed rate first mortgage due by October 2015.

Agree Realty Corp. acquired a retail property net leased to CVS/Caremark Corp. in Atchison, Kan., for $4.2 million.

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