Two joint ventures, eight regional shopping centers, $5.4B on the table
In a series of exceptionally complex deals, Manatt orchestrated the formation of two joint ventures involving major stakes in eight regional shopping center properties. Our client, The Macerich Company, sold a 40 percent interest in five regional centers to GIC, the sovereign wealth fund of Singapore. At the same time, they sold a 49 percent interest in three centers to Heitman LLC, a real estate investment firm. The eight properties together have a reported value of $5.4 billion.
The unusual complexity was evident from the start. As an offshore investor, GIC was subject to an array of arcane tax rules limiting its ability to own and control any joint venture. This necessitated a complex REIT structure that would allow GIC to invest in the business without tripping unnecessary tax liability. But first, several of the portfolio properties needed to be repositioned — either into or out of existing joint venture structures. These repositionings were delicate transactions in themselves, structured to minimize transfer taxes and gain recognition.
The deal was also an exercise in coordination. With three major parties and eight properties in play, it was up to us to coordinate a large group of professionals on both sides of two different tables, assuring that the myriad tax, real estate, financing and business concerns were all addressed in appropriate and timely ways.
Macerich had no hesitation about handing the job to Manatt. Having been through many deals with us, they knew we were more than capable of seeing highly complex multibillion-dollar transactions through to conclusion. And they knew we would make sure that for all three parties, the result would be a win-win-win.
ClientThe Macerich Company
Real Estate Partnerships & Joint Ventures
Commercial Property Owner / Manager