Natick Collection Owner Receives Third Offer
Two offers to help General Growth Properties get out of bankruptcy just wasn’t enough.
General Growth, which owns the Natick Collection mall as well as Boston’s Quincy Market, received a third investment offer valued at $3.925 billion.
The offer was made by Fairholme Capital Management LLC, one of General Growth’s largest unsecured creditors, and Pershing Square Capital Management, one of General Growth’s largest equity holders. The new equity capital investment represents $15 per share.
The Fairholme/Pershing Square deal comes on the heels of a takeover offer from competing mall giant Simon Properties as well as a $2.65 billion equity offer from Brookfield Asset Management.
Under terms of the proposed deal, Brookfield Asset Management would have a 30 percent stake in General Growth. The very complex deal would pay existing General Growth shareholders $15 per share. It would also split General Growth into two separate companies - one called General Growth Properties and the other, General Growth Opportunities.
Meanwhile, Simon Properties made an unsolicited $10 billion takeover bid that would have paid stockholders $9 per share. General Growth said it was not interested in selling the company, but rather raising capital and maintaining independence.
Local Perspective
While General Growth has insisted that operations will continue as usual at both the Natick Collection and Quincy Market, Jon Hurst, president of the Retailers Association of Massachusetts admitted that when such large corporate upheavals are happening, it can be a stressful time for retail tenants.
“Too many retail locations, particularly this time of year, have dark stores,” Hurst said. “You need to turn those around rapidly and bring in new exciting draws. Having a strong financial owner is an important part of attracting those tenants.”
The prospect of some resolution to General Growth’s bankruptcy is welcome news locally.
“You don’t want to see local businesses that have invested in your community not be successful,” said Patrick Reffett, community development director in Natick.
The Natick Collection opened in 2008 after an expansion and renovation to the pre-existing Natick Mall. During the permit application process for the Natick Collection expansion, the town established numerous requirements, including that the developer improve traffic flows around the mall and that the town receive some funding to make additional improvements.
Reffett said there had been concern that some of the money owed to the town would be lost during a bankruptcy proceeding.
But General Growth has since made all necessary payments to the town and complied with all the regulations associated with the permits.
One of those includes a $340,000 payment the town received to study traffic improvements to the North Main Street, which Reffett said is in the design phase.
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