Simon Property Group Acquires 50 Percent Stake in Jamestown

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Mall owner Simon Property Group has acquired a 50 percent stake in Jamestown from the real estate investment trust’s founding partners Christoph Kahl and Ute Kahl.

But the merger is less of a takeover and more of a partnership, according to leaders of both firms, who framed the deal Tuesday as mutually beneficial.

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“We have been impressed with Jamestown’s combination of sector expertise, dedication to driving creative placemaking, and reputation in the fund management business,” David Simon, chairman, president and CEO of Simon Property Group, said in a statement. “Their strong leadership team and track record align with our focus on investing in best-in-class partners. Jamestown is well positioned for future growth.”

Jamestown will continue to operate independently under the leadership of CEO Matt Bronfman and President Michael Phillips, according to a joint press release, while Christoph Kahl will transition to Jamestown’s board of directors for daily involvement in that company’s operations.

“At Jamestown, our goal is to be the best mixed-use investor globally, focusing on creating innovation hubs and community centers,” Phillips said in a statement. “The partnership with Simon will help us achieve that goal and position us for our next chapter as we scale our differentiated products in an increasingly global world.”

Terms of the deal were not disclosed, but it is expected to close near the end of the quarter, according to Simon Property Group. 

Jamestown has $13 billion in assets under management. Its investments such as One Times Square, Chelsea Market and Industry City in New York City, Ponce City Market in Atlanta and Ghirardelli Square in San Francisco are expected to diversify Simon’s mall-centric portfolio.

Simon Property Group’s (SPG) stock price seems to have had a reaction to the news, having risen 0.82 percent between when the markets opened and 11:09 a.m. Eastern Time. But the price per share is still down 29 percent compared to this time last year.

Mark Hallum can be reached at mhallum@commercialobserver.com.