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Firm purchases Maryland property for nearly $100M

An out-of-state real estate firm paid approximately $98.5 million for two Maryland shopping centers, according to recently released Baltimore land records. The company, Ashkenazy Acquisition Corp., reached a purchase agreement with Maryland-based General Growth Properties in March of 2012, though news of that deal only became public in the fall. USB Real Estate Securities Inc. reportedly granted a $76 million loan to Ashkenazy to finance the purchase. 

According to an official with one investment banking and consulting company, Ashkenazy paid a fair price for the 150,000 square foot property, giving General Growth approximately $650 for each square foot. He called the purchase a "great investment" for Ashkenazy, citing growing demand for retail space in Baltimore; he said the deal will also likely be beneficial for the city. General Growth has had difficulty attracting business to the shopping centers since acquiring them after purchasing former owner Rouse Co. for around $12.6 billion.

Experts say Ashkenazy likely purchased the agreement knowing that retailers have become increasingly interested in the shopping centers in reason years; the property saw prominent tenants like H&M and Ripley's Believe it Not Odditorium since 2011. Although it is uncertain how much rent Ashkenazy is set to collect from its tenants, the property's value is assessed at about $40 million for tax purposes. The city of Baltimore owns the land where the property is locating, leasing it to the shopping centers' owner for an undisclosed sum.

The transaction marks the latest in a long series of sales by General Growth, which emerged from bankruptcy in 2010. General Growth sold the leasing rights non-Maryland-based market to Ashkenazy for $136 million in 2011, selling a North Baltimore mall to the same firm for $25 million in 2012. It is unclear whether Ashkenazy will take on any more of General Growth's holdings.

Source: Baltimore Sun, "$100 million paid for Harborplace," Steve Kilar, Jan. 15, 2013

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