My good friend Jim Troy who publishes the Howard/Arundel Report, reports that the portfolio of office buildings owned by GGP in Town Center are now “eligible” to be sold. Jim reports that “the 10-year moratorium on selling assets that were part of the Rouse Company REIT lapses this year on the approximately million square feet portfolio.”
Interesting. If GGP needed to generate cash this would certainly attract attention from investors, particularly foreign buyers looking to capitalize on the favorable exchange rates.
Ah, but that is unlikely to occur. GGP has too much at stake in Town Center right now. It will be much easier for them to achieve their redevelopment plans if they control the surrounding properties. Besides that, the Town Center buildings have a significant vacancy level right now (approximately 30%) which pushes down the value. It is always better to sell an office property when it is 90% leased preferably under long term leases to strong credit tenants. These types of tenants will be more attracted to these buildings if GGP is able to create the type of Town Center they envision.