The French commercial real estate company that owns the Westfield Garden State Plaza in Paramus plans to sell the sprawling shopping mall as it looks to divest a portfolio of U.S. properties valued at $13.2 billion.
Paris-based Unibail-Rodamco-Westfield wants to focus more on its core locations in Europe and is embarking on a “radical reduction of financial exposure in the U.S,” the company told investors last week.
It wasn’t immediately clear how much the Paramus complex could fetch or who the interested buyers could be. Unibail didn’t respond to messages seeking more information this week.
The Paramus site was valued at $2.71 billion, roughly $950 per square foot, in a 2018 CNBC study prepared by research firm Boenning & Scattergood, making it the ninth most valuable mall in the nation at the time.
“It’s probably one of the most profitable and valuable in the entire portfolio,” Paramus Mayor Richard LaBarbiera said of the mall’s location.
Still, the four years since that study have brought monumental disruptions to the retail sector, from COVID-related lockdowns to the popularization of e-commerce, supply chain problems and spiraling inflation.
Unibail’s planned sale was first reported by the Wall Street Journal.
The company owns 85 shopping centers across Europe and the U.S, including the underground mall at the World Trade Center site in Manhattan. It expects to divest of its U.S. properties by the end of next year, CEO Jean-Marie Tritant told investors.
“This is the beginning of an exciting journey for [Unibail] that will reshape the business to focus on our core strengths in Europe … and unlock value from our asset portfolio to generate sustainable growth by 2024,” he said in a statement.
Malls across the U.S. were looking to reinvent themselves even before the pandemic, as more consumers turned to online shopping. Westfield in 2019 announced plans for a sweeping overhaul that would repurpose an empty J.C. Penney and replace parking areas with a mix of retail and residential development
That project is being implemented in phases and negotiations are still underway for a residential developer, Unibail Chief Investment Officer Olivier Bossard said at the company’s investor conference last week.
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The Garden State Plaza is near several other major mall operators that stand out as possible buyers, said Artie Baris, a commercial real estate agent with Coldwell Banker Realty in Fort Lee. Real estate companies tend to buy and sell within their own industry, he said in an interview.
“They trade among themselves, they sell among themselves,” Baris said.
Mall operators in North Jersey, including the owners of American Dream in East Rutherford, the nation’s largest, didn’t respond to messages asking about their potential interest.
Brookfield Properties, which owns Paramus Park mall and Willowbrook Mall in Wayne; Urban Edge Properties, owner of the Bergen Town Center on Route 4 in Paramus; and Simon Property Group, which runs The Shops at Riverside in Hackensack and Rockaway Townsquare in Morris County. also did not respond.