Jones Lang LaSalle Inc. a real estate services company, said Monday it expanded its retail arm by acquiring third-party mall and shopping center leasing and management responsibilities from No. 2 U.S. mall owner General Growth Properties Inc.
Terms of the deal, which closed on Friday, were not disclosed. General Growth, which filed for bankruptcy protection in April 2009, will continue to manage and lease the nearly 200 malls it owns.
Under the deal, Jones Lange will take over from the General Growth’s unit that oversees properties owned by other companies and investors. The agreement covers 18 regional malls and shopping centers and adds more than 11 million square feet to its retail portfolio of 84 million square feet in the Americas and 265 million square feet globally.
About 200 employees on the management teams at the 18 properties as well as 30 corporate employees who provide services to the properties will become Jones Lang LaSalle employees.
The properties in the deal include: Branson Landing in Branson, Missouri; Burbank Town Center, Burbank, California; Cherokee Square Shopping Center, Tullahoma, Tennessee; Festival Bay Mall, Orlando, Florida; Kings’ Shops, Waikoloa, Hawaii; Laurel Commons, Laurel, Maryland; The Shops at Georgetown Park, Washington, DC; St. Lawrence Centre, Massena, New York; Swansea Mall, Swansea, Maryland; and Westdale Mall, Cedar Rapids, Iowa.
Mark Hunter, General Growth’s former senior vice president of third-party management; Donn Fuller, vice president of asset management and development; and John Taylor, General Growth’s former vice president of accounting and finance at General Growth, are all now senior vice presidents at Jones Lang LaSalle.
Under the alliance between the two Chicago-based companies, Jones Lang LaSalle will provide other third-party services to new and existing clients, including pension funds and other institutional investors in the market for property leasing and management services as well as sales and financing sources services, Jones Lang said.
General Growth shares closed up 2.5 percent, or 33 cents at $13.75 Friday on the New York Stock Exchange. Jones Lang shares ended up 1.8 percent, or $1.19, at $67.71 on the NYSE.
Besides helping to stabalize General Growth, a relevant part of this deal is that apparently the bulk of the jobs being transferred to Jones Lang will actually stay in Chicago (downtown, the real Chicago). The people may have different responsibilities, move to a different building but do not have to car commute in traffic, and the city retains the business.