CLEVELAND-Forest City Enterprises said Wednesday it has completed and partly closed its joint ventures with QIC Global Real Estate, the real estate arm of Australia-based Queensland Investment Corp., on eight US malls. First announced in June, the deal brings QIC GRE a 49% equity interest in the properties at a cost of $435.6 million, with the portfolio valued at $2.05 billion.

Seven of the eight individual JVs closed on Tuesday, with the eighth expected to close by month's end. Forest City expects to generate total liquidity of about $350 million after transaction costs. It will remain as managing member of the individual JVs and handle leasing, management, marketing and operation of the retail properties. The company expects to use most of the liquidity to pay down debt, but will use a portion of it to fund expansion and renovation at some of the malls.

For Forest City, the partnership with QIC represents “our largest such initiative to date, and an exciting opportunity to work with an experienced global investor to enhance these already strong retail centers,” says David LaRue, Forest City's president and CEO. “We look forward to building a mutually beneficial, long-term relationship that creates value for both of our organizations.”

When the deal, representing QIC GRE's first direct investment in this country, was announced in early June, managing director Steven Leigh commented, “Expansion into the US retail sector is a natural progression and comes after extensive investigation of the real estate market.” The investment, he added, provides the firm with scarce, premium-quality offshore properties that meet the global real estate needs of institutional clients.

The eight properties being JVed are: Victoria Gardens in Rancho Cucamonga, CA; Charleston Town Center in Charleston, WV; Mall at Robinson near Pittsburgh, PA; Promenade in Temecula, CA; Galleria at Sunset in Henderson, NV; Antelope Valley Mall in Palmdale, CA; Short Pump Town Center in Richmond, VA; and South Bay Galleria in Redondo Beach, CA.

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