Council Approves Firm's Takeover of Malibu Lumber Yard Ground Lease
• Ohio-Based Realty Trust Buys Out Original Partners
BY BILL KOENEKER
The Malibu City Council, at its meeting this week, approved the sale of the ground lease of the Malibu Lumber Yard shopping center by Malibu Lumber LLC to Glimcher Properties Limited Partnership.
Before the council did so, they heard from the city's consultant Allan Rotin on his assessment of the transfer said to be worth approximately $35 million but unconfirmed.
Officials from Glimcher, which is publicly traded, said they would be making a required filing this week and the price tag would become public knowledge, but they could not do so until that time.
Rotin said some of the questions he had in mind and that others might ask are:
Is Glimcher qualified financially and at a suitable management level?
Do they have a good plan for the Lumber Yard since it is not a typical shopping center?
What are the financial impacts to the city and the community?
Rotin said Glimcher has $1.8 billion in assets. "They have the money and the depth of management," he concluded.
The consultant indicated he was impressed they would be using the same management company that Malibu LLC has been using.
He said property taxes should go up slightly because of the sale and the city should make the same amount of money or more.
Michael Glimcher was asked a few questions by Mayor Laura Rosenthal, including "How do you view this center?"
Glimcher said, "We view it as a gem. It is very well done. We think we can make it better, especially the common area by having more activities and doing improvements. The occupancy is at 80 percent. We think it could be 95 percent. We are sensitive to the local tenants because we know we need the right mix. We are moving our company upscale and think this has a huge growth profile."
Partners Richard Weintraub and Richard Sperber, who make up the majority interest of Malibu Lumber LLC have declined to speak publicly for the past week or so as the deal waited for city approval.
Over the past few months, Sperber has made no secret of wanting out, but Weintraub has insisted he was in it for the long haul.
When a previous city council inked the original deal, much was made that both partners were locals, who lived with their families in Malibu, as a justification for the 50-plus-years ground lease.
Glimcher Malibu LLC, a Delaware Limited Liability Company, is the affiliated entity of Glimcher Properties, which is expected to assume all of the obligations of Malibu Lumber LLC.
The council's action, recommended by the staff, "is to authorize the city manager to execute all documents necessary or appropriate fir the transfer of the ground leasehold interest of Malibu Lumber LLC in such form as the city manager shall determine is appropriate," according to the staff report.
Glimcher Realty Trust, which trades on the New York Stock Exchange, describes itself on its website as "a premier real estate investment trust and a recognized leader in the ownership, management, acquisition and development of malls, which includes enclosed regional malls, and open-air lifestyle centers, as well as community centers."
Based in Columbus, Ohio, Glimcher was formed in 1994 "to continue and expand the business and operations of The Glimcher Company, which was founded by Herbert Glimcher, current GRT Chairman Emeritus and Trustee.
Glimcher Properties currently owns or manages a total of 26 properties in 13 states. "Of the 26 properties, 22 are regional malls or super-regional malls, many of which are located in the country's top-growing metropolitan statistical areas," according to its website.