CBL & Associates Properties, Inc. (NYSE:CBL) announced future
redevelopment/replacement plans for JCPenney anchor locations in the CBL
portfolio that are expected to close in 2015 and provided an update on
current redevelopment projects.
“As we mentioned on our last earnings call, we fully anticipated these
closures by JCPenney and have already made significant progress on our
plans to redevelop with new stores and restaurants that will generate
higher traffic and productivity,” said Stephen Lebovitz, president &
CEO. “With the closures officially announced, we can now move forward
towards signing leases and construction timelines.”
Lebovitz added, “The closure of underperforming anchor stores continues
to be one of the best value-creation opportunities we have today. Each
mall serves as the primary retail hub in their markets and attracts
strong retail demand. These closures will allow us to take space that is
underperforming and convert it into fresh new retail, driving increased
traffic, sales and growth to the entire property as well as generating
strong returns to CBL.”
Today, JCPenney announced its intention to close four locations in the
CBL portfolio at York Galleria, York, PA; Walnut Square, Dalton, GA;
Regency Mall, Racine, WI and Randolph Mall in Asheboro, NC. CBL
anticipates store closures to occur in the second quarter. Three
locations are leased from CBL. The Regency Mall store was owned by
JCPenney and recently sold to a third party as a redevelopment
opportunity. The leased stores aggregate approximately 212,000 square
feet and $0.9 million in gross annual rent. JCPenney will continue to
pay rent until lease expiration.
Based on CBL’s extensive track record of successful anchor
redevelopment, similar projects have generally required 12-24 months to
complete and an investment of $3–10 million generating initial
unleveraged returns in the range of 7-10%. More specific cost and return
information regarding the three JCPenney locations closing this year
will be announced as plans are finalized.
In 2014, CBL added or redeveloped more than 25 anchor and junior anchor
locations to its portfolio comprising more than 600,000 square feet. CBL
currently has three anchor redevelopment projects on tap to begin
construction in the coming months. These projects include the
redevelopment of a former JCPenney location at Janesville Mall in
Janesville, WI into Dick’s Sporting Goods and ULTA and the redevelopment
of a former JCPenney at Hickory Point in Forsyth, IL into Hobby Lobby.
About CBL & Associates Properties, Inc.
CBL is one of the largest and most active owners and developers of malls
and shopping centers in the United States. CBL owns, holds interests in
or manages 148 properties, including 89 regional malls/open-air centers.
The properties are located in 30 states and total 84.2 million square
feet including 6.5 million square feet of non-owned shopping centers
managed for third parties. Headquartered in Chattanooga, TN, CBL has
regional offices in Boston (Waltham), MA, Dallas (Irving), TX, and St.
Louis, MO. Additional information can be found at cblproperties.com.
Forward-Looking Statements
Information included herein contains "forward-looking statements"
within the meaning of the federal securities laws. Such
statements are inherently subject to risks and uncertainties, many of
which cannot be predicted with accuracy and some of which might not even
be anticipated. Future events and actual events, financial and
otherwise, may differ materially from the events and results discussed
in the forward-looking statements. The reader is directed to the
Company's various filings with the Securities and Exchange Commission,
including without limitation the Company's Annual Report on Form 10-K
and the "Management's Discussion and Analysis of Financial Condition and
Results of Operations" included therein, for a discussion of such risks
and uncertainties.
Copyright Business Wire 2015