Santa Monica Place’s Value Plummets 35% Amidst Struggles to Sell
Santa Monica Place, a specialty mall owned by Macerich, has seen its value take a significant hit, with the property now valued at $255 million, down 35% from its original value.
Macerich’s Struggle to Sell the Property
The mall’s value has fallen 59% from its original value of $622 million when the loan was issued, according to Morningstar Credit. The property’s struggles to attract tenants have not helped its value, with Bloomingdale’s and Arclight Theatre exiting the center in 2021, leaving around 150,000 square feet vacant.
Macerich’s Plan to Redevelop the Property
In 2023, Macerich planned to redevelop the vacant space in a project estimated to cost between $35 million to $40 million. However, it appears that these plans have been put on hold, with the company now looking to sell the property.
Macerich’s Debt Reduction Strategy
Under CEO Jackson Hsieh, Macerich has been working to reduce its debt by about $2 billion. As part of this strategy, the company has been selling off properties it no longer sees as having a long-term future in its portfolio. In addition to Santa Monica Place, Macerich is also looking to sell The Shops at Atlas Park in New York, Southridge Mall in Iowa, and The Oaks mall in Thousand Oaks for $157 million.
Future of the Property
While Macerich has confirmed that it is looking to sell Santa Monica Place, it remains unclear what the future holds for the property. As part of its debt reduction strategy, Macerich is focusing on its "Fortress centers," which include the Los Cerritos Center and Washington Square in Portland.
Conclusion
Santa Monica Place’s struggles to attract tenants and its declining value have made it a difficult property to sell. However, Macerich’s debt reduction strategy and plans to focus on its more profitable assets may ultimately benefit the company in the long run.
FAQs
Q: Why is Macerich selling Santa Monica Place?
A: Macerich is selling Santa Monica Place as part of its debt reduction strategy and to focus on its more profitable assets.
Q: How much is Macerich looking to sell Santa Monica Place for?
A: The exact sale price of Santa Monica Place has not been disclosed.
Q: What is the current value of Santa Monica Place?
A: The current value of Santa Monica Place is $255 million, down 35% from its original value.
Q: Will Macerich redevelop the vacant space at Santa Monica Place?
A: It appears that Macerich’s plans to redevelop the vacant space at Santa Monica Place have been put on hold.
