Starwood Buys Two Northeast Ohio Malls as Part of $1.6B Deal

By Adrian Maties, Associate Editor

Investment firm Starwood Capital Group last week completed the acquisition of seven dominant regional malls in four states, on the West Coast and in the Midwest. The deal was announced in September. Two Northeast Ohio shopping centers are also included in the portfolio.

The two Northeast Ohio malls are the Great Northern in North Olmsted and Belden Village in Canton. The Great Northern Mall is the largest of the two. It is a single-level enclosed shopping mall with about 1.2 million square feet of retail space, and is anchored by Macy’s, Dillard’s, Sears, J.C. Penney and Dick’s Sporting Goods. The mall was constructed by the Biskind Development Co. and opened in 1965. Great Northern is currently undergoing an expansion project that will bring  a new movie theater, restaurants, reconfigured retail space and a new main entrance. The project is expected to be completed by the end of the year.

Belden Village offers 826,140 square feet of space. It was constructed by The Richard E. Jacobs Group and opened in 1970. Belden Village is anchored by Dillard’s, Macy’s and Sears.

Starwood now owns three shopping centers in Northeast Ohio. The company acquired Strongville’s SouthPark Mall last year.

The portfolio contains 7.9 million square feet of retail space. It includes another Ohio mall, Franklin Park, in Toledo, with nearly 1.3 million square feet of retail space. The other malls in the portfolio are the Capital in Olympia, Wash., the Southlake in Merrillville, Ind., and the Parkway in El Cajon and Plaza West Covina in West Covina, Calif. All of the malls are anchored by major national retailers, with an average occupancy of almost 96 percent. Starwood acquired the portfolio from the Sydney, Australia-based Westfield Group for $1.6 billion. Westfield will retain a 10 percent common equity interest in the properties. Read more about this story here.

Marcus & Millichap reports that retail property operations throughout the Cleveland metro area have been strengthened by growing apartment development activity. According to a report for the third quarter of 2013, transaction velocity in multi-tenant properties has almost doubled in the past four quarters, with the median price for multi-tenant properties reaching $38 per square foot. The Akron, Stark County and Northeast submarkets generated 40 percent of all sales in the past 12 months. Activity in Akron and Stark County more than doubled during this time.