CBL cuts share in Raleigh center

Company shares fall to 6-year low

CBL & Associates Properties, Inc. has cut its ownership share in the Triangle Town Center and Commons in Raleigh, N.C., but the Chattanooga- based shopping center developer will continue to manage the shopping mall and gain more favorable terms for the debt on the property.

CBL announced Monday the Raleigh retail complex was sold for $174 million, including assumption of the $171.1 million debt. Under terms of the sale, the debt will be restructured and lowered from 5.737 percent to only 4 percent.

The new joint venture that bought the property is 90 percent owned by DRA Advisors LLC and 10 percent owned by CBL. Previously, CBL split equally the ownership of the property with The Richard E. Jacobs Group.

“We are pleased to enter into

this new joint venture with a high-quality institutional investor,” CBL President Stephen Lebovitz said in a statement Monday. “With North Carolina’s only Sak’s Fifth Avenue and an excellent offering of retail, dining and entertainment, Triangle Town Center is well-positioned in the market.”

The sale is part of CBL’s strategy announced in April 2014 to divest of 21 shopping centers — about one fourth of the company’s portfolio — and restructure other properties to trim its debt and focus on higher-performing properties and stronger real estate partnerships.

“We are in the process of transforming CBL by transforming our portfolio and our properties,” Lebovitz told investors during a conference call last week. “The reality is that our shopping centers are more than just places to shop. We are in the real estate business, not the retailing business. Our properties are the suburban Town Centers for their communities, with market dominant franchise locations. And we have tremendous opportunities to create significant value, the redevelopment, expansions, and densification.”

Lebovitz said the debt restructuring on the Triangle Town Center provides the new owners “the flexibility to move forward and unlock the center’s potential.”

Andrew Peltz, managing director of DRA, said his company is “prepared to invest fresh vision and capital to bring the asset to a new level.”

Despite such prospects, however, CBL’s stock still declined Monday along with the stock market as a whole. Shares of CBL closed down 65 cents per share, or more than 6 percent, to $ 10.11 per share on the New York Stock Exchange. Monday’s closing price for CBL’s stock was the lowest for the company in more than six years and was down 88.6 percent from CBL’s peak stock price reached nine years ago.

Contact Dave Flessner at dflessner@timesfree press.com or at 423 -757-6340.