SOURCE: Developers Diversified

April 07, 2005 16:34 ET

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

CLEVELAND, OH -- (MARKET WIRE) -- April 7, 2005 -- Developers Diversified Realty (NYSE: DDR) announced it has sold interests in three community shopping centers located in Parker, CO, McDonough, GA, and Grandville, MI, 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 $63.8 million, which equates to a 7.2% cap rate. The sale of the properties will generate merchant building gains of approximately $14.5 million that will ultimately be included in the Company's Fund From Operations ("FFO"). These gains were anticipated in the Company's prior 2005 earnings guidance.

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.

Parker Pavilion, which is located in Parker, CO, is a 97,000 square foot community center anchored by Home Depot (unowned), Wal-Mart Supercenter (unowned) and Office Depot. McDonough Marketplace, which is located in McDonough, GA, is a 31,000 square foot community center anchored by Lowe's Home Improvement (unowned) and Wal-Mart Supercenter (unowned). Grandville Marketplace, which is located in Grandville, MI, is a 217,000 square foot community center anchored by Lowe's Home Improvement (unowned), Circuit City, Linens 'N Things, Gander Mountain and OfficeMax.

Including these three community centers, the MDT joint venture owns 35 community center assets across the U.S. totaling over 14 million square feet and representing 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, 2004.

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