09/28/2012

Macerich Seeks Giant Loan on Queens Mall

A Macerich partnership is seeking a fixed-rate loan of up to $650 million on a top-quality mall in New York’s borough of Queens.

The partnership has asked lenders to submit proposals for a mortgage of either $600 million or $650 million on the property, called Queens Center. That would put the loan-to-value ratio at 50-55%. The loan term would be 10 or 12 years. Eastdil Secured is advising Macerich on the financing.

The new loan would enable Macerich and its partner, Ontario Teachers, to take a big chunk of cash out of the property after retiring a $320 million loan. That loan, which matures in March 2013, becomes eligible for prepayment on Dec. 1.

The 970,000-square-foot Queens Center is considered a “fortress” mall because of its high quality and strong in-line sales, which are to projected to hit $1,000/sf by yearend. The property, which is 97.2% occupied, is anchored by Macy’s and JC Penney. In their respective chains, the JC Penney store is the top performer and the Macy’s store ranks fifth.

Several in-line stores are also top performers for their companies, including outlets of A/X Armani, Aeropostale, Children’s Place, Club Monaco, H&M and Pink. If the Macerich team succeeds in signing Apple to a pending 10,000-sf lease, in-line sales could jump to as high as $1,300/sf, according to marketing materials for the loan.

Macerich, a REIT in Santa Monica, Calif., bought the mall in 1995 and sold a 49% stake in 2009 for $152.7 million to Toronto-based Cadillac Fairview, a real estate firm that is wholly owned by Ontario Teachers.

Queens Center is at 90-15 Queens Boulevard in the Elmhurst section, about five miles from Midtown Manhattan. It sits at the intersection of three major roadways: Queens Boulevard, the Long Island Expressway and Woodhaven Boulevard.

The three-level mall, which has a 1,900-car garage, was constructed in 1973 and renovated and expanded in 2004.

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