Westfarms, located on the West Hartford/Farmington border, will be sold to Simon Property Group as part of an agreement for Simon to acquire Taubman Centers, Inc.
By Ronni Newton
A deal valued at approximately $3.6 billion, announced Monday, Feb. 10, will result in the transfer of ownership of Taubman’s shopping centers in the U.S. and Asia to Simon Property Group.
A press release issued by Simon, states that “through its operating partnership, Simon Property Group, L.P., will acquire all of Taubman common stock for $52.50 per share in cash and the Taubman family will sell approximately one-third of its ownership interest at the transaction price and remain a 20% partner in TRG.” TRG – Taubman Realty Group – owns 21 high-end shopping centers in the U.S. and three in Asia, totally roughly 25 million feet of gross leasable area.
In addition to Westfarms, in Connecticut Taubman also owns Stamford Town Center. Other high-end properties nationwide include The Mall at Short Hills (New Jersey), Beverly Center (Los Angeles), Fair Oaks Mall (Virginia), The Mall at Green Hills (Nashville), and International Market Place (Waikiki, HI).
“Both Taubman and Simon will continue to operate as usual and as separate companies until the transaction closes,” Taubman spokesperson Maria Mainville told We-Ha.com in an email. “After the transaction is completed, Taubman expects to operate much as we do today, including related to the ownership of our properties and how we serve our shoppers.”
The deal is expected to close in mid-2020, according to the press release, and current Taubman Chairman, President and Chief Executive Officer Robert S. Taubman, in partnership with Simon, will continue to manage the properties following the sale. “The parties have agreed to work together to implement best practices to achieve operational efficiencies and will eliminate Taubman’s public company costs immediately following closing,” the release states.
In a statement, Simon Chairman of the Board, Chief Executive Officer and President David Simon said, “We are very pleased to announce this transaction, which will be immediately accretive to Simon’s FFO. By joining together, we will enhance the ability of TRG to invest in innovative retail environments that create exciting shopping and entertainment experiences for consumers, immersive opportunities for retailers, and substantial new job prospects for local communities. I look forward to partnering with Bobby and the TRG executive team in this exciting new joint venture.”
Taubman said in a statement, “Since Taubman Centers’ founding 70 years ago, we have built a portfolio of high-quality assets and continuously adapted to the evolving retail landscape. I am proud of all that this company’s talented employees have achieved and am thrilled to have the opportunity to join together with Simon through this joint venture. Over the last few years, David and I have developed an excellent personal relationship and importantly, Simon shares our commitment to serving retailers, shoppers and the communities in which we operate. The Board and I are confident that Simon is the ideal partner to help us build on our progress.”
Myron E. Ullman, Lead Director of the Taubman Board of Directors and Chairman of the Special Committee of the Taubman Board of Directors said in the release that the transaction is expected to deliver “a significant, immediate cash premium to shareholders.”
Westfarms, which opened in October 1974, is anchored by Macy’s, Lord & Taylor, Nordstrom, and JCPenney. On Monday, Connecticut-based Maggie McFly’s announced plans to open a 10,000 restaurant at Westfarms later this year.
Simon is already the owner of more than 200 premium outlet and shopping center properties, including Connecticut’s Clinton Crossing Premium Outlets in Clinton and Crystal Mall in Waterford. Among their other properties are Copley Place in Boston; The Westchester in White Plains, NY; King of Prussia Mall near Philadelphia; Potomac Mills outside Washington, DC; The Forum Shops at Casesar’s in Las Vegas; and multiple malls in the Orlando, FL, area.
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