Taubman forms outlet center joint venture

Taubman Centers plans to ramp up its outlet center development this year and has started a joint venture with a former executive of Prime Outlets.

The Bloomfield Hills-based real estate investment trust, which owns Great Lakes Crossing Outlets, said it hired Bruce Zalaznick's OutletPartners. He is a former executive vice president of Prime Outlets and Chelsea Property Group. Zalaznick brings 20 years in successful outlet development to the joint venture in which Taubman Centers holds a 90% ownership interest in any projects that move forward.

The upscale mall owner and operator converted its Auburn Hills-based Great Lakes Crossing to an outlets format last fall. It has been delivering sales growth ever since.

"We will be very disappointed if we don't have one or two projects visible by the end of the year," Robert S. Taubman, chairman, president and CEO of Taubman Centers, said Friday. "Over the next 10 years we think we can open five to 10 outlet centers."

Taubman said the joint venture would focus on the top 30 markets nationwide that "can support high-productivity centers of at least $400 sales per square foot."


Investors boosted Taubman Centers shares Friday after it reported record sales per square foot and issued guidance for a profitable 2011.

Taubman Centers stock closed up 91 cents to $53.82 a share on the New York Stock Exchange. It reported its fourth-quarter results Thursday after the market closed.

Taubman Centers reported a record 12.4% boost to $564 in its sales per square foot for 2010. The real estate investment trust also reported strong increases in net income, funds from operations and occupancy from its 23 shopping centers.

Net income for the three months ended Dec. 31 was $36.8 million, or 60 cents a share, up from $7.6 million, or 7 cents a share, in the same period a year ago.

Funds from operations, a cash-flow measure of real estate investment trusts, rose to $59.6 million, or $1.06 a share, from $31.1 million, or 56 cents a share in the last three months of 2009.

Taubman issued guidance for 2011 with funds from operations to be in the $2.62 to $2.74 range and earnings per share to be in the range of 75 cents to 89 cents, assuming it holds title to the Pier Shops in Atlantic City, N.J., and Regency Square in Richmond, Va.

SOURCE: Detroit Free Press