SPRINGFIELD, VA—Springfield Town Center is opening its doors after an extensive renovation on Oct. 17, with a 81% occupancy rate. PREIT is acquiring the mall from Vornado Realty Trust, a $465-million transaction that was announced earlier this year. The non-anchor space will have an occupancy rate of more than 60% but that is expected to increase to more than 90% by the end of 2015.
The yield in 2018, the first stabilized year, is anticipated to be approximately 6.7%. The anticipated yield separately values the property's development rights at approximately $80 million and factors in the estimated value of the one-time earnout payment to be made to Vornado in 2018. PREIT expects to complete the acquisition on March 31, 2015.
"We are extremely excited to open Springfield Town Center which, upon integration into our portfolio, will underscore the remarkable progress we have made in creating a high quality mall portfolio," said PREIT CEO, Joseph F. Coradino, in a prepared statement.
"Since announcing our strategic objectives in November 2012, we have strengthened our portfolio quality and balance sheet and with the sale of 11 properties, including 6 non-core malls, raising over $400 million in proceeds."
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