Real Estate Weekly: Simon Property closes $2.3B Prime Outlets deal

Posted: 11:17 am Fri, September 3, 2010
By Staff and Wire Reports

Baltimore-based Prime Outlets is now part of the Simon Property Group Inc. following the completion of a $2.3 billion sale, Simon said this week.

Prime owned 22 outlet centers in major metropolitan areas, including Washington, D.C., and Orlando, Fla. With the completion of the deal Simon has 63 outlet centers with about 25 million square feet.

Simon also owns regional malls and other assets. The company owns 387 properties with 262 million square feet, including sites in Europe and China.

The purchase from Lightstone Group was announced in December, and Simon had expected to complete it in March. The company signed a proposed consent agreement with Federal Trade Commission staff that will be sent to the agency for its approval, Indianapolis-based Simon said in a statement Tuesday.

Tennis center plan advances
The Howard County Tennis Patrons and the county have signed a lease, making formal a partnership to build a sports and concert venue in Elkridge.

The nonprofit HCTP will build the Troy Park Tennis and Sports Center on 14 leased acres in Troy Regional Park. The Women’s Tennis Association has scheduled an international tournament in the 8,000-seat multi-use stadium for July 25, 2011.

Completion of the project is expected in 2012. The center will have 30 indoor and outdoor courts. The HCTP is seeking funding by selling naming rights, box suites and seat licenses, contracting with vendors and requesting donations.

Construction jobs up, down
Maryland’s Calvert, Charles and Prince George’s counties added 2,800 construction jobs — more than any other metro area in the nation — between July 2009 and July 2010, according to an analysis of federal employment data released Tuesday by the Associated General Contractors of America.

The Baltimore/Towson, Bethesda/Rockville/Frederick and Hagerstown/Martinsburg areas all experienced decreases. Construction employment declined in 276 of 337 U.S. metropolitan areas, demonstrating the widespread decline in demand for construction services that continues to outpace stimulus-funded work, according to association officials.

Velocity Commercial plans IPO
Velocity Commercial Capital Inc., a Maryland corporation focused primarily on originating and acquiring small balance commercial real estate loans, said Monday it has filed a registration statement with the Securities and Exchange Commission for a proposed initial public offering of its common stock on the New York Stock Exchange under the symbol “VCC.”

The registration statement relates to an aggregate amount of $175 million of common stock. Velocity expects to use the net proceeds from the offering for general corporate purposes. It plans to conduct its operations to qualify as an internally-managed real estate investment trust for federal income tax purposes.

State halts wind farm work
Erosion violations have halted work on a western Maryland wind farm.

The Maryland Department of the Environment issued an order last week telling Synergics Wind Energy and its contractor to halt work on the Backbone Mountain site near Oakland. An MDE spokesman said violations included missing and inadequate silt fences meant to prevent mud and other sediment from washing into streams.

He said the order was issued after a complaint from a nearby resident and several inspections. The violations are easily correctable, and the company has told the department they are expected to be corrected by Tuesday, the spokesman said.

BWI Hilton goes solar
Hilton Hotel BWI Airport has begun using solar power supplied by Distributed Sun, a Washington, D.C.-based solar project developer and services provider.

The system, owned by Distributed Sun’s Solar Energy Investment Co., sunONE, is expected to generate nearly 60 megawatt-hours of electric power per year, and more than 2 gigawatt-hours over its lifetime. The company has been installing rooftop units in Maryland, Delaware, Pennsylvania and New Jersey, and this fall plans to provide 50 megawatts to commercial and industrial buildings with installations on rooftops, carports and on the ground.

National Cancer Institute holds groundbreaking
Ground was broken this week on a new National Cancer Institute facility on Johns Hopkins University’s Montgomery Campus in Rockville.

The building, an expansion of the Shady Grove Life Sciences Center, will cost $200 million and take two years to build. It will house 2,100 employees, consolidating staff members from various offices.

Merritt buys 35 acres near Aberdeen Proving Ground
Merritt Properties has closed on the purchase of a 35-acre site at 635-660 McHenry Road in Aberdeen.

Once developed, the campus — which is less than two miles away from the Aberdeen Proving Ground — will consist of five buildings totaling approximately 265,900 square feet.

Plans for Merritt’s Aberdeen Corporate Park include two three-story Class A office buildings (approximately 95,200 square feet each and two retail pad sites (approximately 6,000 square feet each).

County officials hope the project boosts opportunities for high-tech companies moving into the county to support the various Aberdeen Proving Ground missions, according to James Richardson, Harford County’s Director of Economic Development.

LaSalle buys three hotels for $293M
Bethesda-based LaSalle Hotel Properties has acquired the Hotel Monaco San Francisco for $68.5 million, the Westin Philadelphia for $145 million and the Embassy Suites Philadelphia – Center City for $79 million.

The Westin Philadelphia, which will continue to be managed by HEI Hotels & Resorts, has 294 guestrooms, including 19 suites, 17,000 square feet of flexible function space and a 7,500-square-foot grand ballroom.

The Embassy Suites Philadelphia – Center City, a 288-suite, full service hotel will also continue to be managed by HEI Hotels & Resorts. The property has 3,000 square feet of meeting space and a 280-seat full-service restaurant located on the lobby level.

The Hotel Monaco, meanwhile, is LaSalle’s first venture into the San Francisco market.

This Week in Leases

• CyberCore Technologies signed a lease for 19,254 square feet of industrial space at 6650 Business Parkway in Elkridge. Michael A. Elardo and Brian N. Kruger of Preston Partners represented the building owner in this transaction. Matthew Laraway, senior director with Cushman & Wakefield’s Baltimore office, represented the tenant. CyberCore Technologies provides computer hardware and software products and services to public and private sector clients in the U.S.

• Baltimore Industrial Equipment and Supply LLC signed an office/warehouse lease at 150 Blades Lane in Glen Burnie for 2,550 square feet of space. Jamie Campbell, Vince Bagli, Ridgely Bowman and Steve Shaw of Merritt Properties represented their firm, the landlord, and served as the only brokers on the deal. 150 Blades Lane is a single-story masonry construction building, part of a two building complex totaling 85,000 SF accessible via Route 10, I-695 and Route 2 in Anne Arundel County.

• Tasti D-Lite, a frozen yogurt and desserts chain, unveiled aggressive expansion plans this week for the Greater Baltimore region, including signing a lease for 2,100 square feet of space at Park Plaza in Severna Park. Franchise owner Ben Pascal, who owns the franchise rights for the mid-Atlantic region, plans to open 12 to 15 Tasti-D-Lite locations within the next several years and is already scouting sites in Georgetown, K Street and Dupont Circle in Washington, D.C.