The Bon-Ton Stores Inc., which has headquarters in Milwaukee and York, Pa., announced today that it has sold six of its stores, including three in the Milwaukee area, to one of New York-based W.P. Carey Inc.’s non-traded real estate investment trusts for $84 million.
Bon-Ton sold its Boston Store properties at Mayfair Mall in Wauwatosa, Bayshore Town Center in Glendale and Southridge Mall in Greendale; its Younkers store at Bay Park Square in Ashwaubenon; its Carson’s store in Joliet, Ill. and its Herberger’s store in Fargo, N.D.
The Mayfair Mall Boston Store property sold for about $18.4 million, the Southridge Boston Store property sold for about $16.3 million and the Younkers store property in Ashwaubenon sold for about $12 million, according to state records.
Bon-Ton bought the Southridge store last year from Anthony Palermo for $3.9 million. Bon-Ton completed a substantial remodeling of that store in 2012.
Sale price information about the Bayshore Town Center store was not immediately available.
Under a sale leaseback agreement with the W.P. Carey REIT, Bon-Ton will continue to occupy the stores as a tenant.
“These are important properties for Bon-Ton. We see them as being committed to these properties,” said W.P. Carey spokesman Guy Lawrence. “We like their locations. They are good properties.”
Proceeds from the store sales, supplemented with money borrowed under Bon-Ton’s revolving credit facility, will be used to pay one of the company’s mortgage loan facilities due in April of 2016. Each mortgage loan facility has principal outstanding of about $105 million and consists of 12 properties, the company said.
“The sale-leaseback of these six properties allows us to address the maturity of one of our mortgage facilities and further enhances our financial flexibility through the value of the remaining properties no longer encumbered by the mortgage facility,” Bon-Ton president and chief executive officer Kathryn Bufano said. “We are actively pursuing refinancing options for the second of our two mortgage facilities.”
Bufano joined Bon-Ton last year and is working to turn around the struggling company. Bon-Ton reported a fiscal first quarter loss of $34.1 million and has not turned an annual profit since 2010.