VEGAS INC Coverage
The Boulevard Mall in Las Vegas will be spun off to new ownership under plans announced Monday by its current owner, General Growth Properties Inc.
Chicago-based General Growth, which emerged from bankruptcy in November, said it plans to spin off 30 generally underperforming or "B" malls around the country to holders of General Growth stock in the form of a taxable special dividend.
The dividend would consist of common stock in a recently formed company called Rouse Properties Inc.
Rouse is expected to qualify as a real estate investment trust (REIT) and be listed on the New York Stock Exchange.
General Growth is transferring the 30 malls to Rouse Properties, and their associated $1.1 billion in debt, so General Growth can concentrate on what it calls "premier’’ malls.
The Boulevard Mall on Maryland Parkway, with 1.176 million square feet of leaseable area, and other malls to be transferred to Rouse were described by General Growth on Monday as having significant upside potential.
The 30 properties are 87.7 percent leased and offer ``significant opportunities to enhance value through the execution of rigorous asset management strategies, including redevelopment,’’ General Growth said.
The 87.7 percent leased rate compares to 92.4 percent for General Growth’s portfolio of regional malls as of March 31. The Boulevard Mall is just 77 percent leased, General Growth said.
After the deal, General Growth would own four Las Vegas malls: Meadows, Fashion Show, Shoppes at the Palazzo and the Grand Canal Shops at the Venetian.
After its bankruptcy, General Growth similarly spun off its planned communities, including Summerlin in Las Vegas, to a new company based in Dallas called Howard Hughes Corp.