SANTA MONICA, CA—The Macerich Co. has boughtout its joint venture partner's 49% stake in five shopping centers,including four on the West Coast, for $1.89 billion including theassumption of $673 million in debt. The balance of the deal was theissuance of $1.22 billion in common stock to JV partnerCadillac Fairview Corp., a wholly owned subsidiaryof the Ontario Teachers' Pension Plan Board.

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The sale gives Cadillac Fairview a 10.9% ownership stake inMacerich. John Sullivan, Cadillac Fairview's CEO,is joining the retail REIT's board of directors. The OTPPBsubsidiary and Macerich have had a JV relationship since 1999.

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Totaling 6.7 million square feet, the properties includeLakewood Center in Lakewood, CA; Washington Square in Portland, OR;Los Cerritos Center in Cerritos, CA; Stonewood Center in Downey,CA; and Queens Center in New York City. The latter is thehighest-grossing of the properties at $1,089 per square foot across971,000 square feet; the largest of the five, the2.1-million-square-foot Lakewood Center, is also the lowestgrossing at $429 per square foot. The portfolio averages 97%occupancy.

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“In a sector in which quality acquisition opportunities rarelypresent themselves, the opportunity to consolidate our ownership inthese highly productive, market dominant centers through astock-for-asset exchange represents a real opportunity to increaseour overall portfolio quality and growth prospects,” saysArt Coppola, chairman and CEO of Macerich. “On a sales per-square-foot basis, Queens Center andWashington Square are currently our two most productive assets,both generating sales of over $1,000 per square foot while LosCerritos Center, which is currently generating nearly $700 persquare foot in sales and undergoing a $45-million expansion,represents the linchpin of our dominant South L.A. market position,along with Stonewood and Lakewood.”

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Paul Bubny

Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.