SOURCE: Developers Diversified Realty

March 14, 2005 08:00 ET

Developers Diversified Realty Announces Sale of Shopping Center Assets to Macquarie DDR Trust

CLEVELAND, OH -- (MARKET WIRE) -- March 14, 2005 -- Developers Diversified Realty (NYSE: DDR) announced it has sold interests in three community shopping centers located in Plainville, CT; Brandon, FL (two retail assets) and Brown Deer, WI (two retail assets) to the Company's joint venture with Macquarie DDR Trust (ASX: MDT) ("MDT"), an Australian Listed Property Trust sponsored by Macquarie Bank Limited (ASX: MBL), an international investment bank and leading advisor and manager of specialized real estate funds in Australia. The three community shopping centers have an aggregate purchase price of $170.4 million, which equates to a 7.3% cap rate.

Developers Diversified also anticipates that over the next two months, MDT will acquire three additional community shopping centers from the Company's consolidated portfolio subject to approval by the Board of Macquarie DDR Management Limited, the manager of the MDT joint venture. These community shopping centers are located in Parker, CO; McDonough, GA and Grandville, MI.

Developers Diversified retains a 14.5% ownership interest in the properties acquired by MDT. The Company remains responsible for all day-to-day operations of the properties and receives its share of ongoing fees for property management, leasing and construction management, plus nominal one-time fees for financing and due diligence. The Company also receives base asset management fees and incentive fees based on the overall performance of MDT relative to the S&P/ASX 200.

Connecticut Commons, which is located in Plainville, CT, is a 567,000 square foot community center anchored by Lowe's Home Improvement, Kohl's, Loews Theaters (unowned), Dick's Sporting Goods, Linens 'N Things, Old Navy, A.C. Moore, PETsMART, DSW and Levitz Furniture. Lake Brandon Village and Lake Brandon Plaza, which are located in Brandon, FL, combine to form a 440,000 square foot community center anchored by Lowe's Home Improvement (unowned), Sports Authority, Linens 'N Things, PETsMART, Publix Supermarkets, Jo-Ann Fabrics, CompUSA and Babies "R" Us (unowned). The Market Place of Brown Deer and Brown Deer Center, which are located in Brown Deer, WI, comprise a 410,000 square foot community center anchored by Pick 'N Save, Marshall's Mega Store, Kohl's, Michaels, OfficeMax, T.J. Maxx and Old Navy.

Including these three community centers that have closed and the three community centers that are expected to close within the next several weeks, the MDT joint venture will own 35 community center assets across the U.S. totaling over 14 million square feet. On a pro forma basis, the MDT joint venture portfolio will represent nearly $2 billion in aggregate value.

Developers Diversified owns or manages approximately 470 operating and development retail properties in 44 states, plus Puerto Rico, comprising approximately 108 million square feet. Developers Diversified is a self-administered and self-managed real estate investment trust (REIT) operating as a fully integrated real estate company which develops, leases and manages shopping centers. You can learn more about Developers Diversified on the Internet at www.ddr.com.

Developers Diversified Realty Corporation considers portions of this information to be forward-looking statements within the meaning of Section 27A of the Securities Exchange Act of 1933 and Section 21E of the Securities Act of 1934, both as amended, with respect to the Company's expectation for future periods. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. For this purpose, any statements contained herein that are not historical fact may be deemed to be forward-looking statements. There are a number of important factors that could cause the results of the Company to differ materially from those indicated by such forward-looking statements, including, among other factors, local conditions such as oversupply of space or a reduction in demand for real estate in the area, competition from other available space, dependence on rental income from real property or the loss of a major tenant. For more details on the risk factors, please refer to the Company's Form 10-K as of December 31, 2003.

Contact Information

  • Contact:
    Michelle A. Mahue
    Vice President of Investor Relations
    Developers Diversified Realty
    Main: (216) 755-5500
    Fax: (216) 755-1455
    E-mail: mmahue@ddr.com