TIAA-CREF teams with APG on US mall portfolio

The New York retirement fund has created a joint venture with the Netherlands-based pension group for stakes in a retail portfolio valued at $1.53 billion.

Town Center

The New York-based retirement fund TIAA-CREF has formed a joint venture with Netherlands-based APG for a portfolio of five US regional malls, in which it recently acquired stakes, according to an announcement by TIAA-CREF. The joint venture is 51 percent owned by TIAA-CREF and 49 percent owned by APG.

“We believe that this venture will allow us to continue to capitalise on opportunities we see in the super-regional mall sector,” said Scott Kempton, managing director of global real estate portfolio management at TIAA-CREF, in a statement.

“This partnership with TIAA-CREF combines the strength of two global investment platforms to pursue dominant US mall assets,” said Steven Hason, managing director and co-head of Americas real estate at APG. “The venture is a continuation of APG’s strategy to invest with partners that have similar long-term investment objectives and the right mix of demonstrated management capabilities, coupled with exceptional alignment of interests.”

The joint venture acquired interests in four malls in Kansas, Missouri, Tennessee and Texas that are owned by CBL & Associates Properties. Those properties were included in a deal between TIAA-CREF and CBL that was completed earlier this month and reduced the Chattanooga, Tennessee-based mall owner’s debt by $486 million. The joint venture also bought an interest in a fifth property in Bethesda, Maryland from Australia-based Westfield Group.

“We have been exploring joint venture opportunities for quite some time,” said Stephen Lebovitz, president and chief executive of CBL. “We believe TIAA-CREF is the right partner for CBL and together have structured a mutually beneficial venture.”

The properties include West County Center, a 1.12 million-square-foot mall in St. Louis, Missouri; Coolsprings Galleria, a 1.12 million-square-foot retail centre in Franklin, Tennessee; the 1.57 million-square-foot Oak Park Mall in Overland Park, Kansas; the 718,000-square-foot Pearland Town Center in Pearland, Texas; and the 604,461-square-foot Westfield Montgomery in Bethesda.

A spokesperson for CBL told PERE that the firm will maintain a 50 percent stake in West County Center, Coolsprings Galleria and Oak Park Mall and a 12 percent stake in Pearland Town Center. All told, the five properties are valued at $1.53 billion, according to data provider Real Capital Analytics.