DDR Corp. and an affiliate of Madison International Realty announced the recapitalization of a joint venture with 52 shopping centers previously owned by DDR and various partners, totaling $1.05 billion.
Madison International Real Estate Liquidity Fund VI, an investment fund managed by Madison International Realty, acquired 80 percent of the common equity of the joint venture and an affiliate of DDR retained 20 percent.
This ownership structure is consistent with the structure of the joint venture prior to the recapitalization and will be a long-term strategic partnership. DDR will continue to provide leasing and management services.
The portfolio, totaling 7.0 million square feet, consists primarily of grocery anchored shopping centers located predominantly in Florida and the Southeastern United States and was originally formed in 2007.
Three properties previously held by the partnership have been excluded from the recapitalization and are being held in a separate joint venture with the previous partners of DDR Domestic Retail Fund I including DDR.
The recapitalization includes the repayment of all outstanding mortgage debt previously held by the partnership with a new $707 million mortgage loan ($141 million at DDR share) secured by the 52 assets.
Ronald M. Dickerman, founder and president of Madison International Realty, said, “Madison’s investment will allow existing partners to exit, Madison to expand its retail footprint, and DDR to continue its value creation strategy.”
