At the same time, CBL is developing Cobblestone Village, a a 305,000-sf, 45-acre center in St. Augustine, FL, 100 miles north of Downtown Orlando and about 150 miles southeast of Panama City. Cobblestone Village has an expected spring 2003 opening.

In a cash-stock-debt deal, CBL paid Panama City Associates LLC $76.64 per sf for the 54-acre property at 23rd Street (State Road S-390A) and Cove Boulevard (State Road 77). Panama City Associates is an affiliated of Detroit-based Robert Aikens and Associates LLC. The property's location was crucial in CBL's acquisition decision.

"Panama City Mall is 65 miles away from the nearest competing mall and serves a growing trade area of approximately 260,000, plus an annual tourist count exceeding four million," CBL chairman/CEO Charles B. Lebovitz says in a prepared statement.

He expects the acquisition to generate an initial unleveraged return of 10.5%. Excluding property management fees and structural reserve the return is about 10.9%.

CBL plans to expand the mall and its franchise value at an undetermined date on the adjoining 10 acres. The mall posted shop sales of $280 per sf in 2001, joining a select group of retail centers achieving $250-per-sf-plus levels, according to industry newsletters. Dillard's, JCPenney and Sears anchor the property.

The purchase price comprises 118,695 newly issued special common units of CBL's operating partnership valued at $45 per unit and a dividend yield of 8%; the assumption of $40.7 million in non-recourse mortgage debt; and $458,000 in cash closing costs.

In St. Augustine, Cobblestone Village is CBL's second new shopping center development under way in the last 30 days. The project is being built at an estimated hard construction cost of $125 per sf or a total $38 million. CBL didn't disclose the construction cost in its statement but emphasized location, like the Panama City Mall acquisition, prompted the Tennessee developer to start the project.

The site is at Old Moultlrie Road and State Road 312 in the center of St. Augustine's retail area.

The center will be anchored by Beall's Department Store, Publix Supermarkets, Ross Dress for Less, Michael's Arts and Crafts, Bed, Bath & Beyond and Pier 1 Imports. Lebovitz calls the tenants "strong anchors." Cobblestone Village will have space for two additional anchors and about 20 other specialty retailers.

"We are optimistic that we will be able to continue to expand our development pipeline during the year," Lebovitz says in the statement.

Projected rents weren't disclosed but area retail brokers tell GlobeSt.com on condition of anonymity the range in the central business district is $15 per sf to $20 per sf.

CBL's common on the New York Stock Exchange at noon was trading at $37.80 per share unchanged from May 31. Volume was 17,400. The 52-week high-low is $38.20 and $25.85 per share.

The price/earnings ratio is 13.50. There are 29.1 million shares outstanding. The company's market capitalization is $1.1 billion.

Instant Insights /

CBL Buys Panama City Mall for $46.5M; Breaks Ground on St. Augustine Center

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