HOBART | The Southlake Mall in Hobart officially has a new owner who is looking to bring fresh ideas to its expanding portfolio of shopping centers.
Private investment firm Starwood Capital Group announced it has closed on a $1.64 billion deal to buy a majority interest in seven malls, including the nearly 1.4 million-square-foot, two-story super-regional mall at U.S. 30 and Mississippi Street in Hobart. Sydney, Australia-based retail giant Westfield will keep a 10 percent share.
Starwood has bought 14 malls across the United States from Westfield in the past two years. The Connecticut-based global investment firm – which has $29 billion in assets that include beach resorts, golf courses, offices, condo towers – has spun off a new retail business to manage all the malls it recently acquired.
The newly formed Starwood Retail Partners also owns and operations the nearby Chicago Ridge Mall in Chicago Ridge and the Louis Joliet Mall in Joliet.
"I believe we can build a differentiated company in the retail mall marketplace and are pleased we have reached 'critical mass,'" said Barry Sternlicht, chairman of Starwood Retail Partners. "We intend for Starwood Retail Partners to be an important new player in this industry, with fresh ideas and collaborative partnerships with tenants and to attract great people talent to power our growing platform."
Starwood Retail Partners plans to leave the existing on-site management teams in place at all the newly purchased malls, including Southlake. Collectively, the malls have 7.9 million square feet of retail space and an occupancy rate of 96 percent.
"Over the last 18 months, we have assembled a portfolio of 19 high-quality regional malls and retail centers with an aggregate purchase price in excess of $3.2 billion," said Scott Wolstein, CEP of Starwood Retail Partners. "We believe that regional shopping malls offer an attractive value proposition for our partners. We look forward to selectively pursuing new opportunities to expand our portfolio."
Southlake first opened in the early 1970s and and has been owned by Westfield since 2002, when the Australia-based mall operator bought it for $756 million. Anchor tenants include Carson Pirie Scott, J.C. Penney, Macy's, Sears and Dick's Sporting Goods.