Aviv Arlon Global Ltd. (TASE: AVLN), a joint venture of Aviv & Co. and Arlon Global LLC, has bought the Metropolis shopping center in Indianapolis for $52 million. Aviv & Co. is owned by chairman Doron Aviv and CEO Dafna Harlev; Arlon Global is owned by Eyal Lev Ari and Iftach Alony.
The 56,000-square meter Metropolis shopping center is located on a 68-acre lot. It was opened in 2005 at an investment of $160 million. The mall is 81% occupied, and 65% of the leases are long term. Anchor stores include fashion chains Rave, Old Navy, Victoria's Secret, and JC Penny, bookseller Barnes and Noble Inc. (NYSE: BKS), DSW, and Theatre.
The mall's annual rent is $9 million, and its annual net operating income (NOI) is $5.5 million.
Aviv Arlon bought the Metropolis shopping center from its court-appointed receiver. The mall's previous owner went into receivership after failing to repay loans. Aviv Arlon obtained a $39.1 million loan bearing 6.47% annual interest. The loan principal will be repaid in a single payment after five years, and only interest payments will be made during the loan period.
Doron Aviv said, "We're continuing to develop real estate activity in the US, including the purchase, redevelopment, and leasing of income-producing real estate. This is our second purchase of a mall, and this mall is double the size of the first mall, in Bonita Springs in western Florida." He added, "This deal reflects the company's business acumen and in-depth knowledge of the US market."
Aviv Arlon owns 44.1% of Aviv Arlon, and Aviv & Co. owns 40.2%. Aviv Arlon's share price was unchanged by early afternoon at NIS 0.37, giving a market cap of NIS 124 million.
Published by Globes [online], Israel business news - www.globes-online.com - on August 29, 2010
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