Macerich Co. has agreed to sell minority stakes in eight U.S. malls for $2.3 billion to Singapore’s GIC Pte and property investor Heitman LLC in a deal that will allow the landlord to pay a special dividend, buy back shares and cut debt.
Santa Monica, California-based Macerich has been under pressure to boost shareholder value after spurning a $16.8 billion takeover offer from Indianapolis-based Simon Property Group Inc. earlier this year.
GIC, in its first deal with Macerich, will own 40 percent of five malls, and Heitman will have a 49-percent interest in three, Macerich said in a written statement Wednesday. The transactions are scheduled to close in phases starting in October and concluding in the first quarter.
The $2.3 billion deal with GIC and Heitman includes $1.14 billion of proceeds from new financing on five properties as part of the deal, Macerich said. The company plans to use the proceeds for share buybacks, debt reduction and a special dividend of $3.50 to $4.50 a share.
GIC will own stakes in Arrowhead Towne Center in Glendale, Arizona; Lakewood Center in Lakewood, California; Los Cerritos Center in Cerritos, California; Washington Square in Portland, Oregon; and South Plains Mall in Lubbock, Texas. Heitman will gain interests in Deptford Mall in Deptford, New Jersey; FlatIron Crossing in Broomfield, Colorado; and Twenty Ninth Street in Boulder, Colorado.
“As a long-term value investor, we look forward to partnering with Macerich, one of the premier owners and operators of shopping centers in the U.S.,” Lee Kok Sun, regional head for the Americas at GIC Real Estate, said in the statement.
The properties are valued at a total $5.4 billion, according to Macerich.
Simon shares were up 1.3 percent Thursday morning, to $186.04 each. Macerich shares rose 1.7 percent, to $78.10.