A joint venture formed by Ohio-based DDR Corp. (NYSE: DDR) and an affiliate of the New York Blackstone Group (NYSE:BX) has closed on the acquisition of 71 shopping centers previously owned by American Realty Capital Properties, Inc. (NASDAQ: ARCP) for $1.93 billion. The Arizona assets were multi-tenant properties that were acquired by Cole Real Estate Investments of Phoenix (NYSE:COLE) prior to ARCP’s $11.2 billion acquisition of Cole in February of this year.

Blackstone Real Estate Partners VII, a real estate fund managed by Blackstone Group on behalf of its investors, owns 95% of the common equity of the joint venture and an affiliate of DDR owns the remaining 5%. DDR will provide leasing and management services and has the first right of refusal to acquire 10 of the assets, under certain conditions.

The joint venture assumed approximately $437 million of existing non-recourse debt, which has a weighted average term of 7.1 years and an interest rate of 4.45%. The venture also originated an additional $800 million non-recourse loan from Wells Fargo and CitiGroup Global Markets Realty Corp., which has a five-year term and an interest rate of LIBOR plus 160 basis points.

The high-quality, well-located portfolio of power centers, grocery-anchored neighborhood centers and anchored community centers acquired by the joint venture includes 71 properties totaling approximately 11.3 million-square-feet in 25 states.

Silverado Plaza at 105 S Houghton Road in Tucson was sold for a $12 million ($152 PSF) loan assumption. This 78,749-square-foot Safeway anchored center in southeast Tucson was 99% occupied at time of sale and represented the only ARCP asset in Tucson. Cole had acquired the property in December 2011 for $9.25 million.

The Shops at Prescott Gateway, located at the southwest corner of Highway 69 and Lee Boulevard, adjacent to Prescott Gateway Mall in Prescott sold to the venture for $14.9 million ($430 PSF) for the 34,671-square-feet shopping center. Cole had paid $12.77 million for the center in 2013.

Prime power centers in Los Angeles, Houston, Denver, Chicago, Atlanta, Washington D.C. and Phoenix were the primary retail centers included in the portfolio.

In Phoenix, San Tan Marketplace sold for $66.1 million ($232 PSF) for the 285,511-square-feet within a 690,000-square-feet San Tan Village, a 1.2 million-square-foot regional mall at 2697-2817 S Market Place in Gilbert. The purchase excluded Walmart and Sam’s Club anchors. Plaza at Power Marketplace at 7225 S Power Road in Queen Creek also sold for $13.5 million ($430 PSF) for this 70,973-square-foot plaza

Lisa E. Beeson, President and Chief Operating Officer of ARCP said, “This strategic disposition eliminates approximately $550 million of secured debt, improves our portfolio occupancy and weighted average lease term, reduces capital expenditures and streamlines our property operations. We believe this transaction immediately improves our portfolio and drives long-term value for our shareholders while focusing on our single-tenant, net lease investment strategy.”

This is DDR and Blackstone’s third joint venture together. David J. Oakes, president and chief financial officer of DDR, commented, “We are pleased to once again announce the closing of a transaction with our partners at Blackstone, further highlighting our ability to source high-quality acquisitions in an opportunistic manner. In consultation with our partner, we are in discussions with various counterparties to sell a portion of the portfolio over the near term with the goals of improving the risk-adjusted returns and maximizing portfolio quality for the joint venture.”

David S. Kay, Chief Executive Officer of ARCP had this to say, “With the sale of our multi-tenant properties, we continue to focus on reducing complexity while strengthening the ARCP story as the leading, solely-focused net lease REIT. The disposition to Blackstone and DDR provides approximately $1.34 billion of net proceeds that will be used to reduce leverage by paying down our line of credit as we look towards additional options to further term-out our debt.”

Chris Milkie of DDR is handling the leasing of the four Arizona properties. Milkie can be contacted at 602.343.7504.

Life Care Centers of America through an affiliate, Tucson Real Estate Investors and Forrest L. Preston of Cleveland, TN, exercised an option to purchase the property it had been leasing for 10-years at 6211 N La Cholla Blvd in Tucson for $7.55 million ($46,572 per bed).

The seller, Health Care REIT of Toledo, OH purchased the property in December 2005 for $13 million in a sale leaseback agreement with Life Care Centers of America.

Located directly across the street from Northwest Medical Center, Life Care Center of Tucson is a 75,840-square-foot facility on 3.5 acres, licensed for 162 residents, offering skilled nursing services to seniors.

The privately-held company has been consolidating its focus on core facilities-based operations according to Preston. In September, the Cleveland, TN, businessman sold 13 home health agencies operated by the home health care business affiliated with Preston’s Life Care Centers of America. Life Care Home Health was sold to the to the Lafayette, LA-based home health care firm, LHC Group, Inc, a national provider of home health, hospice and comprehensive post-acute healthcare services, for $10 million, in the first major asset sale from this nursing home and senior care empire.

Life Care’s home health division, which was created in 1997, produced revenues of $28.5 million last year, with about 90 percent of the payments coming from Medicare. The agencies operated in 8 states, and comprised about 1 percent of the $2.9 billion a year of revenues generated by all of Preston’s Life Care businesses.

Preston said at the time of sale it would help Life Care “pursue a primary strategic focus on core facilities-based operations.”

Life Care manages more than 200 facilities with 31,255 beds in 28 states, and provides long-term, post-acute and short-term care and rehabilitation services for elderly patients, and also offers home-care services through its subsidiary, Life Care Home Health Inc.

Login for additional information.

[mepr-show rules=”58038″]Sale date: 11/6/2014. Sale price: $7,544,672, with $722,788 down and balance financed with conventional loan. Property APN: 101-09-003M[/mepr-show]

New York-based Loews Hotels & Resorts has purchased the Ventana Canyon Hotel & Resort for $33.5 million ($84,100 per room) from Ventana Canyon Hotel Associates (The Estes Family) of Tucson.

Since 1984, Loews has managed the 442,526-square-feet property, on approximately 83 acres,  and reported there would be no operational changes for the resort. However, next Spring a significant multi-million-dollar update to the resort is expected to take place.

This Tucson landmark is located in the stunning Catalina Mountain range in the Sonoran Desert, with serene desert landscape and two Tom Fazio-designed PGA golf courses.  The Real Estate Daily News recently reported this hotel & resort has been named for the past 30 years on the AAA list of Diamond Hotels and Resorts.

Loews Ventana Canyon has two signature heated pools, a Jacuzzi, a deluxe full-service Spa, plus 398 luxury guestrooms including 26 plush suites all with incredible views. Our 37,000-square-feet of indoor function space, and nearly 40,000-square-feet of outdoor space make this Tucson resort the perfect spot for a dream wedding or ideal choice for a corporate function.

The Frank Lloyd Wright-inspired architecture is surrounded by indigenous saguaro cactus trees. The stone columns at the entrance are modeled after the cacti, right down to their delicate ridges.

Loews Ventana Canyon Hotel & Resort is also proud to be named in Travel + Leisure‘s 2014 list of the Top 50 Hotels for World’s Best Family Travel.

Loews Hotel & Resorts manages 23 hotels nationwide and earlier this year acquired the Loews Chicago O’Hare and Loews Minneapolis Hotels.

Login for additional information.

[mepr-show rules=”58038″]Sale date: 10/31/2014 APNs: 114-03-353C, 359A, 359B, 360B, 358A, 360A. Public record shows there was a loan assumption. It was reported by buyer that seller will maintain a small minor interest in the property and did not sell ownership to the Flying V Ranch adjacent to the property.[/mepr-show]