NEW YORK, Sept. 20, 2017 /PRNewswire/ -- Madison International Realty and Forest City Realty Trust (NYSE: FCE-A) announced the signing of definitive agreements for Madison's acquisition of Forest City's 51% interest in a 2.1 million square foot, 12 asset, prime retail portfolio located throughout Manhattan, Brooklyn, Queens, the Bronx, Staten Island and Northern New Jersey (collectively the "NYC Portfolio"), for a gross value of approximately $1.0 billion. The acquisition is consistent with Forest City's announcement in August 2016 that it intended to explore strategic alternatives for its regional mall and urban infill retail portfolios. The NYC Portfolio, in which Madison holds a 49% stake, represents a material portion of Forest City's overall retail platform that it has been successfully exiting since its 2016 announcement.
The acquisition of the 95% leased NYC Portfolio represents an opportunity for Madison to become one of the largest retail landlords in New York City with a portfolio that has exhibited prolonged stability due to the dense demographic composition of its location and proximity to extraordinary demand drivers such as Barclays Center. The acquisition is consistent with Madison's view that brick and mortar stores located in high density growth areas in gateway markets will continue to play a critical role in the evolution of retail.
"This transaction is strategic for both Madison and Forest City, and fits well with our investment strategy of executing large scale equity investments to create 'win/win' outcomes for our partners and investors. The retail centers in the NYC Portfolio are in densely-populated, well-trafficked areas that offer significant opportunity for continued value creation," said Ronald Dickerman, President and Founder of Madison. Dickerman continues, "We are pleased to have assisted our partner, Forest City, in accomplishing this important milestone."
Madison will engage Cushman & Wakefield as the third-party property management and leasing team for the NYC Portfolio. Madison is considering the potential redevelopment of Atlantic Terminal Mall and Atlantic Center, two properties located directly across Atlantic Avenue from the Barclays Center Arena and on top of New York City's third largest transportation hub - Atlantic Terminal.
The 51% acquisition will be capitalized with significant follow-on investment from the existing NYC Portfolio investors. Final transaction closing is expected to be completed in Q4 2017.
About Madison International Realty
Madison International Realty (www.madisonint.com) is a leading liquidity provider to real estate investors worldwide. Madison provides equity capital for real estate owners and investors seeking to monetize embedded equity, to replace capital partners seeking an exit and to recapitalize balance sheets. The firm provides equity for recapitalizations, partner buyouts and capital infusions; and acquires joint venture, limited partner and co-investment interests as principals. Madison invests only in secondary transactions and focuses solely on existing properties and portfolios in the U.S., U.K., and Western Europe. Madison has offices in New York, London and Frankfurt, Germany, where the firm operates under the name of Madison Real Estate Beteiligungsgesellschaft mbH.
SOURCE Madison International Realty