Rams Owner Buys Village Mall for $325M, Setting the Stage for Second Major Complex
The assemblage of properties is large enough for a major mixed-use development with retail, hotels, dining or residences to surround a practice facility and a new headquarters.
By Greg Cornfield December 27, 2022 4:40 pm
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The owner of the Los Angeles Rams is set to build a second, massive development in the city’s San Fernando Valley.
Billionaire team owner Stan Kroenke has acquired The Village, an outdoor shopping mall in the Warner Center area, from Unibail-Rodamco-Westfield (URW). The sale price of $325 million reflects an initial yield of 5.6 percent on the in-place net operating income, and a 10.6 percent discount to the last unaffected appraisal, as URW ditches its U.S. portfolio to focus on Europe.
The Village spans 600,000 square feet next to the Promenade development site, which Kroenke purchased in early 2022 for $150 million to build a new practice facility for the Rams. It’s also near a 13-story office tower that Kroenke bought for $175 million a few months later. (URW’s flagship property in the area, Westfield Topanga, was not a part of the transaction.)
The assemblage of properties is large enough for a major mixed-use development with retail, hotels, dining or residences to surround the practice facility and a new headquarters.
The massive project follows the development sequence that’s nearing the completion around Kroeke’s SoFi Stadium (where the Rams won Super Bowl LVI) which is accompanied by a 300-acre mixed-use complex named Hollywood Park in Inglewood that will include 5 million square feet of creative office space, 890,000 square feet of retail, a 300-room hotel, and up to 2,500 new housing units when complete.
With the sale of The Village, URW has now completed $1.1 billion of its planned reduction in its U.S. portfolio, including the sales of Westfield Santa Anita for $537.5 million, the Promenade development, the Palisade residential building for $238 million, and five other regional properties.
“This transaction is another step in the streamlining of our U.S. regional asset portfolio as part of our wider plan to radically reduce our financial exposure to the U.S., and demonstrates the continued investor interest in high-quality assets with strong operating performance,” Fabrice Mouchel, URW’s chief financial officer, said in a statement.
URW operates 80 shopping centers in 12 countries, as well as a portfolio of high-quality offices, 10 convention venues in Paris, and a $2.82 billion development pipeline of mainly mixed-use assets. As of June 2022, its $51.68 billion portfolio is 87 percent in retail, 6 percent in offices, 5 percent in convention and exhibition venues, and 2 percent in services.
Gregory Cornfield can be reached at gcornfield@commercialobserver.com.
