Dillard’s and Trademark just bought a B mall.
Here’s why it makes sense....
Pricing:
-- ~20% cap rate
-- 80% below its peak value
-- Buying out of an orderly bankruptcy liquidation
Capital allocation:
-- Dillard’s is profitable (~9% margin)
-- What do you do with cash? Cost control > investing in apparel
-- At least this is accretive vs. distributing cash
Control and expertise:
-- Dillard’s gets flexibility to re-tenant and reshape the environment
-- Trademark adds a proven track record of repositioning malls
The bigger play?
-- The Dillard family members are large shareholders
-- They're all in on retail and all in on Texas and Florida
-- If Longview works, this could be a repeatable playbook
Kudos to FastTrack guest speaker Terry Montesi for continuing to pioneer retail opportunities!
More info: https://lnkd.in/dxnugVWm