The properties acquired were the 128,075-sf Piedmont Plaza and the 112,292-sf Winterpark Palms Orlando, both of which have redevelopment potential. Macquarie DDR Trust is a property trust sponsored by Macquarie Bank Limited. The assets were recently acquired by Developers Diversified as part of its $6.2-billion acquisition of Inland Retail Real Estate Trust.

"This transaction preserves our equity capital, enhances our long-term fee revenues and includes provisions to recognize promoted income on the value created through redevelopment," says Developers Diversified chairman and CEO Scott Wolstein.

Under the sale, Developers Diversified will retain a 14.5% ownership interest in the properties and will remain responsible for day-to-day operations. The company will also receive a promoted interest above a 10% leveraged IRR, which will be calculated based on the implied value of the assets at stabilization.

Piedmont Plaza is 90.3% leased and plans are to reconfigure the center to accommodate junior anchors and additional small shop space. Winterpark Palms Orlando is 97.3% leased and plans include expanding the existing Publix and adding small shop space.

Developers Diversified vice president of investor relations Michelle Dawson tells GlobeSt.com that the sales were part of a comprehensive review of assets completed in January. Under the review, some assets were sold and some were placed in joint ventures. "Historically we've done some deals with Coventry Real Estate Advisors," she says. "We're looking at other opportunities for joint ventures. This gave us the chance to enhance our relationship with Macquarie DDR Trust."

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