It was a good week for Agree Realty and Retail Properties of America to clear out some old problem properties.
Retail Properties of America Inc. disposed of 13 former Mervyns locations for $100.4 million. Proceeds from the sale were used to repay, in its entirety, the outstanding loan on the firm's 23-asset Mervyns portfolio.
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The 13 assets represent approximately 1 million square feet and are currently 99% leased. The portfolio is located in California and includes the following retailer mix; four Hobby Lobby locations, four Kohl's locations and five Burlington Coat Factory locations.
"This successful transaction is a result of our calculated approach to leasing these boxes to value-oriented retailers, and furthers our strategic objective of focusing on multi-tenant retail," said Shane Garrison, executive vice president and COO for RPAI. "We anticipate closing on the sale of the majority of the remaining former Mervyns locations by the end of the year."
Also this past week Agree Realty Corp. executed two leases and completed a disposition of the company's remaining assets that were formerly leased to Borders. The three transactions will raise the company's portfolio occupancy level to 99%.
The REIT executed a lease with HomeGoods for the building formerly occupied by Borders in Monroeville, PA. The company anticipates rent commencement during the third quarter of 2013. HomeGoods is a subsidiary of The TJX Cos. and this is Agree's first lease with a TJX company.
In addition, Agree has entered into a lease with the City of Lawrence for the former Borders location in Lawrence, KS. Rent is anticipated to commence during the fourth quarter of 2012.
The REIT also has closed on the sale of a 21,000-square-foot single-tenant property formerly leased to Borders in Columbus, OH. The property was sold for $1.7 million or about $81/square foot. It initially paid $2.42 million for the property.
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