PREIT (NYSE: PEI) today announced that its recent sale of Palmer Park Mall marked the ninth lower-productivity mall sold by PREIT since having announced its plans to divest non-core properties in late 2012
These properties generated average sales psf of$254 at the time of sale. The Company also has four additional malls under contract with significant non-refundable deposits. Pro-forma January 31, 2016 portfolio sales per square foot excluding the assets sold or under contract for sale are $451.
In total, including several other non-core properties sold, the program has generated over half a billion dollars in gross proceeds, contributing to the Company’s impressive reduction in its Bank Leverage ratio from 64.1% as of September 30, 2012 to approximately 50% as of December 31, 2015. Balance Sheet strengthening, in addition to portfolio quality, has been at the core of PREIT’s efforts, having demonstrated a plan at its January 2016 investor day to reach below 47% leverage in 2018. The Company has since repaid the mortgage loan on Valley Mall increasing the pool of unencumbered properties supporting our borrowing capacity under our line of credit.
These portfolio improvements are also changing the nature of the Company’s dialog with tenants. The portfolio has a prime presence in two top 10 MSAs, which enables the Company to continue to add new retail and entertainment concepts to its expanding tenant roster, having recently signed key new additions:
- Saks OFF 5th at Springfield Town Center, expanding the lineup of top fashion brands at great value;
- Round 1 Bowling & Entertainment at Exton Square, an entertainment concept from Japan, that includes bowling, arcade games and billiards, representing a unique family entertainment offering that will bring new customers to the property; and
- Dry Goods at Woodland Mall, a boutique-style retail store, created by Von Maur, offering trendy women’s apparel and accessories.
“PREIT is on track to achieve its goal of $500 per square foot in sales, advancing our progression along the mall REIT quality continuum intended to drive shareholder value through an improved multiple and share price,” said Joseph Coradino, CEO of PREIT.
PREIT (NYSE:PEI) is a publicly traded real estate investment trust specializing in the ownership and management of differentiated shopping malls. Headquartered in Philadelphia, Pennsylvania, the company owns and operates over 26 million square feet of retail space in the eastern half of the United States with concentration in the Mid-Atlantic region’s top MSAs. Since 2012, the company has driven a transformation guided by an emphasis on balance sheet strength, high-quality merchandising and disciplined capital expenditures. Additional information is available atwww.preit.com, on Twitter or LinkedIn.
Contact: At the Company
SVP, Corporate Communications and Investor Relations