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Prime Retail Inc. to sell outlet mall

August 12, 1999

Prime OutletsBy LAURA ERNDE / Staff Writer

photo: RICHARD T. MEAGHER / staff photographer




Prime Retail Inc. is selling three factory outlet malls, including Prime Outlets at Hagerstown, to raise capital for more retail centers, the company said Thursday.

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Prime Retail, a partner in the $274 million purchase, will retain control of the outlet centers. The outlet center's name and management will stay the same, said Prime Retail spokeswoman Deboroah Radman.

"This doesn't change anything. It's still going to be a quality shopping experience. People can look forward to that continuing," she said.

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The Hagerstown outlet center is being sold for $57.5 million. The third phase of the outlet center, which hasn't yet been built, is being sold for $23 million, the company said. Combined, they provide more than 300,000 square feet of retail space.

Washington County will receive $611,800 to record the deed transfer based on a tax rate of $7.60 for every $1,000.

The other outlet malls being sold are in Birch Run, Mich., and Williamsburg, Va.

Under the agreement, the Baltimore-based Prime Retail will sell the three outlet centers to a new joint venture between itself and an affiliate of Estein & Associates USA Ltd. Since 1992, Estein has bought more than 3.3 million square feet of outlet center space.

The deal will be closed during four separate transactions between Nov. 18 and Sept. 30, 2000.

The company has the option to buy back the three centers in 2009.

After paying for closing costs and the expansion at the Hagerstown and Williamsburg centers, Prime Retail expects to make $78 million. The company also will make $10 million from refinancing the Williamsburg center.

The company plans to use the money to continue its aggressive development, although locations for new centers are not being named, Radman said.

Prime Retail is the largest owner and developer of outlet centers in the world. Since 1988, it has built 51 outlet centers in 26 states for a total square footage of 14.7 million.

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