Class-B mall portfolio up for grabs

Real Estate Alert, April 28, 2004

A developer is marketing three Class-B-minus malls with a combined value of about $150 million.

The properties are the 560,000-square-foot Central Mall in Port Arthur, Texas, the 547,000-sf Lawton Central Mall in Lawton, Okla., and the 446,000-sf Central Mall in Salina, Kan. The seller, a development firm controlled by the Warmack family of Texarkana, Texas, previously had the Port Arthur property on the block by itself: Several weeks ago, an unidentified investor group agreed to buy it for about $45 million, or an initial annual yield of about 9.5%. But the deal fell through.

Now the Warmacks have decided to offer the three properties as a portfolio. Rockwood Realty has the listing.

In-line sales at the three malls range from $250/sf to $275/sf. The in-line occupancy rates are healthy, in the lowto-mid-90% range. Anchors include Bealls, Dillard's, JC Penney, Sears and Old Navy. Each mall is located in a city that serves a relatively large area with little or no competition.

The Warmack family owns about a half-dozen malls, all of which have been under its control since they were built in the 1970s and 1980s.