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Edwards' Chapter 11 Filing Thwarts Sale of Valencia Mall

August 29, 2000|From Times Wire and Staff Reports

Newhall Land & Farming Co. said Monday that the sale of its Valencia Town Center and adjacent retail property has fallen through because of the recent bankruptcy filing of Edwards Theatres Circuit Inc., which operates 22 movie screens at the shopping complex.

The canceled sale will delay until next year the completion of Newhall Land's planned repurchase of its partnership units. In December, the Santa Clarita-based developer said it planned to sell about $200 million worth of retail, office and residential property and use the money to buy back 20% of its partnership units

On the New York Stock Exchange, Newhall Land's partnership units fell $1.44 to close at $25.25.

Newhall Land officials announced last week that the 675,000-square-foot mall and an additional 125,000 square feet of retail and entertainment space on Town Center Drive were in escrow to be sold to a company identified by industry observers as RREEF, a Chicago-based real estate investment firm. The 8-year-old Valencia Town Center--the retail hub of the Santa Clarita Valley--is anchored by Robinsons-May and J.C. Penney department stores.

Newhall Land said the sale was terminated because of last week's Chapter 11 bankruptcy filing by closely held Edwards Theatres Circuit, which has two theaters with 21 screens and an Imax theater in the mall and the adjoining Valencia Entertainment Center on Town Center Drive. For the first six months of this year, rental income from Edwards represented about 16% of the mall and entertainment center's combined total income.

The buyer wants to wait and see if Edwards closes the theaters, tries to renegotiate the leases or keeps them as is, said Newhall Land spokeswoman Marcia Ward.

"They will probably try to renegotiate," she said.

A spokeswoman for Edwards would not comment specifically on its Valencia theaters. "The company is reviewing all of its theater operations," Ann Julsen said.

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