University Mall is being sold to New York-based Blackstone Real Estate Partners as part of a massive portfolio deal with a price tag of $9.4 billion.
The sale is expected to close in the middle of the year.
Centro Properties Group, based in Australia, announced Tuesday the sale of its 588 U.S. properties and the start of a debt restructuring plan. Centro will use about $600 million from the sale to repay its debts, the company said.
“The thorough and rigorous restructure process we have undertaken with our advisers, and working constructively with our lenders and their advisers, has resulted in this outcome, which we believe delivers the maximum value to all stakeholders,” said Robert Tsenin, Centro Group’s chief executive officer and managing director.
University Mall is a 98,500-square-foot shopping center anchored by Cost Plus World Market and Trader Joe’s, which opened in October. The mall is at 825 Russell Blvd.
Forever 21, the women’s clothing chain, was expected to open in February, but construction is still under way. As of Wednesday afternoon, the store’s actual opening date was unknown.
However, the University Mall sale is not the reason for the delay, said Stacy Slater, Centro’s senior vice president of investment management.
“The transaction will not impact any of the ongoing operations or openings and construction at the property,” Slater said in an e-mail to The Davis Enterprise.
The city of Davis has not received notice of the sale, said Sarah Worley, the city’s economic development coordinator. She said she left a voicemail for someone at Centro to get the details.
“The sale would not necessarily have any impact on the city or the operations of the center,” Worley said Wednesday. “We’re awaiting further information ourselves.”
Tenants at University Mall were unaware of the ownership change.
Heng Ou, owner of Fluffy Donuts at the mall, said he is not concerned about the transfer.
“We should be informed, but it’s their business, so they have the right to do that,” said Ou, who bought his store seven years ago. “So, no, it doesn’t worry me.”
Charlie Swanson, who opened The Graduate restaurant and bar at University Mall in 1971, said communication with Centro has always been “challenging.”
“I would prefer local owners, that’s for sure,” Swanson said. He said he contacted someone at Centro who assured him there would be no change in property managers and staff as a result of the sale.
University Mall has been the focus of local economic development for years. Its proximity to UC Davis and the college’s student dorms make it an ideal location for retailers.
The mall struggled, however, with the loss of Gottschalks when the department store chain folded in 2009, followed by the closures of several smaller stores at the shopping center. Centro had to find a replacement for Gottschalks, which occupied 34,000 square feet.
Forever 21 finally signed the lease for the space last May after a year of on-and-off negotiating.