Vornado to spin off shopping centers into separate REIT
Equity One CEO Jeffrey Olson will head new venture
The speculation is over. Vornado Realty Trust will spin off its 85 shopping centers into a publicly-traded real estate investment trust. The move is in line with Vornado CEO Steven Roth’s pledge to focus the company’s efforts on core assets in New York City and Washington, D.C.
Vornado tapped Jeffrey Olson, the current CEO of shopping center landlord Equity One, to head the new venture. Last month, Equity One announced that Olson would not be renewing his contract.
Vornado is likely to file a request to register securities with the Securities and Exchange Commission in the second quarter of 2014, according to an alert on investment website Seeking Alpha. In total, the properties — the vast majority of them strip malls in the Northeast — contain 16.1 million square feet and had an average occupancy of 95.5 percent at the end of last year.
Over the past two years Vornado has sold about $3.6 billion worth of assets. By making good on his promise to simplify and streamline the company’s business, Roth has “regenerated a lot of goodwil,” Alexander Goldfarb, an analyst with Midtown-based investment banking firm Sandler O’Neill + Partners, told The Real Deal last month.
The news of the venture was first reported by Bloomberg News.