Lightstone Value Plus REIT expands portfolio

Lightstone Value Plus REIT is acquiring interests, varying from 22.54% to 25%, in 20 factory outlet centers from affiliates of Arbor Mortgage REIT. As part of this transaction, the Lightstone Value Plus REIT is also receiving rights to four development projects scheduled to be completed between 2010 and 2012. Lightstone Value Plus REIT is advancing $91.2 million in cash and shares of its operating partnership to fund the acquisition and closing costs, with an additional pro rata share of existing mortgage debt bringing the deal value to $456 million. The existing mortgage debt has an interest rate of 5.54%. By making this acquisition from Arbor Mortgage, the REIT is becoming a co-investor on the same terms (pari passu) with The Lightstone Group. Located in 15 states and managed by Prime Outlets, the 20 outlet centers comprise 7.28 million s/f of gross leaseable area and have an occupancy rate of 93.4%. Prime Outlets is the third largest owner of factory outlet centers in the U.S. as measured by gross leaseable area. Headquartered in Baltimore, the Prime Retail Management Co. operates and manages a portfolio of 23 factory outlet malls, comprising 8.2 million s/f, in 16 states, including the 20 properties in this transaction. Some of Prime Retail's high profile tenants include Gucci, Giorgio Armani, Victoria's Secret, Coach, Ann Taylor, Polo Ralph Loren, Saks Fifth Avenue, Gap, Nike, LL Bean, among others.