|The Howard Hughes Corporation Secures $250 Million Flexible Loan to Advance the Master Redevelopment Plan for Ward Centers|
DALLAS, Jun 29, 2011 (BUSINESS WIRE) --
The Howard Hughes Corporation (NYSE: HHC) today announced the completion of a $250 million loan to support the redevelopment and master plan for Ward Centers in Honolulu, Hawaii. The loan initially funded $212 million to refinance three existing mortgage loans and for closing costs. The remaining $38 million undrawn amount will provide additional capital for the initial redevelopment of Ward. The loan has a five-year term and bears interest at one-month LIBOR+2.50%. At closing Howard Hughes swapped $143 million of the loan to a 3.80% fixed rate. Based on current rates, the blended interest rate is 3.45% and represents approximately $3.6 million of annual interest savings over the refinanced loans. The loan also provides for partial prepayment in order to remove collateral from its borrowing base for redevelopment. The lead lender is Wells Fargo supported by a syndicate of banks including CIBC, First Hawaiian Bank, Bank of Hawaii, American Savings Bank and Central Pacific Bank. The loan was arranged by Randy Fleisher of Quadrant Realty Finance.
"This financing is an important first step as we launch the redevelopment and, ultimately deliver our master plan to unlock the value of Ward Centers. We are pleased to have partnered with lenders who understand the long-term potential of this unique asset," stated David R. Weinreb, CEO of The Howard Hughes Corporation.
Ward Centers is comprised of approximately 60 acres of fee simple land situated along Ala Moana Beach Park. It is within one mile of Waikiki and downtown Honolulu. Ward Centers currently is a 550,000 square foot shopping district containing six specialty centers and over 135 unique shops, a variety of restaurants and an entertainment center, which includes a 16-screen movie theater. In January 2009, the Hawaii Community Development Authority approved a 15-year master plan, which entitles a mixed-use development encompassing up to 9.3 million square feet, including up to 7.6 million square feet of residential (4,300 units), five million square feet of retail and four million square feet of office, commercial and other uses.
"We appreciate the banks' endorsement of our team and their confidence in the opportunity to redevelop Ward Centers into a world class real estate asset," said Grant Herlitz, President of The Howard Hughes Corporation.
"Ward Centers is a quality institutional asset and the lenders are pleased to be able to provide financing and to foster our relationship with The Howard Hughes Corporation," added Kent Howard, Senior Vice President, Wells Fargo & Co.
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