If you want to know why the Pennsylvania Real Estate Investment Trust is willing to pay $465 million for the former Springfield Mall, look no further than the image to your right.
The rendering was originally crafted by Vornado Realty Trust (NYSE: VNO), current owner of what has been renamed the Springfield Town Center, for the site's 2009 rezoning. Now, PREIT (NYSE: PEI) is including it in investor documents, to demonstrate to shareholders and potential tenants what's to come on the sprawling 80-acre lot, and perhaps to justify the $340 million in cash and $125 million in stock PREIT will pay for the property.
When the deal closes, Springfield Town Center will immediately "take its place as number one in our portfolio," Joseph Coradino, PREIT's CEO, said May 30 during the trust's annual shareholder meeting. With its "unsurpassed visibility," Metro accessibility, and affluent Fairfax County demographic, PREIT expects first-year stabilized sales of $525 per square foot.
"Beyond that," Coradino told shareholders, "we have access to 3.3 million square feet of development rights to eventually create on the property to enhance value even more."
That 3.3 million square feet includes nearly 500,000 square feet of office, roughly 1,900 new residential units, 360,000 square feet of hotel space and 74,000 more square feet of retail. The development rights, according to a PREIT investor update released in late May, are worth about $80 million.
Last we checked in with the Springfield Town Center, Vornado was touting the redeveloped mall’s potential, a persistent analyst was questioning the pending sale to PREIT, and a scheduled opening date was emerging, Oct. 17.
Vornado still has not unveiled the list of tenants it has signed to take space at the Springfield Town Center, though we have nailed down more than three dozen based on permits and other sources.
Since our last update, Fairfax County has issued dozens of building permits for future tenant spaces, those that we have reported before, and others that we have not. PREIT also has released a handful of names in investor relations documents. That includes unsigned “targeted tenants” such as Urban Outfitters, L.L. Bean, Balducci’s and Nordstrom Rack.
The latest tenants that we know of, below.
- Zinburger, what will be a 5,500-square-foot wine and burger bar. The nearest Zinburger outpost is in Charlottesville.
- &Pizza (pronounced "andpizza"), for what will be its first Virginia location. The pizza joint currently has three stores in Montgomery County and four in the District.
- J. Crew
- Ann Taylor LOFT
- Charlotte Russe, for “trendy women’s clothing.” There are four area locations, including Tysons and Tanger Outlets National Harbor.
- White House/Black Market, what will be the 14th area location for this women’s clothing boutique.
- American Eagle Outfitters
- Mon Cheri Nails & Spa
- Reeds Jewelers
- Springfield Therapeutic Massage
- Cartoon Cuts
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