Steeplegate Mall blamed in owner’s $24.7M fourth-quarter loss
Steeplegate Mall in Concord has raised eyebrows in its owner’s office.
Rouse Properties, which owns the Loudon Road mall, recorded a net loss of $24.7 million in the last three months of 2013. For the same time in 2012, the company’s net loss was $13.6 million.
In its fourth-quarter report, the company threw blame for that dramatic difference squarely on Steeplegate Mall. Rouse Properties absorbed a $15.2 million “impairment charge” for the mall in the end of 2013, the report states. That “impairment charge” could be a ripple effect of declining value at the Concord mall, although a Rouse Properties spokesperson declined to explain the source of it.
And on a March conference call with analysts about Rouse Properties’ fourth-quarter report, Chief Financial Officer John Wain noted the mall’s drop in value. A transcript of that call was available through Seeking Alpha, a financial research website.
“As we’ve discussed in the past, it is our intention to only invest in capital in a manner which provides an appropriate risk-adjusted rate of return or is of strategic benefit to Rouse,” Wain said on the call. “We will continue to review our options with regard to Steeplegate and update you in the future when we have additional information.”
Over six years, city records show Steeplegate Mall has dropped nearly $30 million from its assessed property value, which is calculated in part using data on retail sales. In 2012, the city assessed the property to be worth $65 million, but records from the board of assessors show Rouse Properties claimed the mall to be worth $37 million that year.
For 2013, the mall’s value is set at $52 million. That number came out of a settlement agreement between Concord and Rouse Properties, which has challenged the city’s assessment in the past several years.
Steeplegate Mall opened in 1990 and is one of 34 malls owned by Rouse Properties. The company acquired the Concord property in 2011, when General Growth Properties spun off 30 shopping malls that were described as not among their top-performing sites.
In 2013, Rouse Properties recorded a net loss of $54.7 million for the year, according to its fourth-quarter report. That’s an improvement from 2012, when the company booked a net loss of $68.7 million. President and CEO Andrew Silberfein said the company’s cash flow has been steadily increasing and leasing has been positive.
“So we are really focused on creating a better experience at our malls by adding the different components, so people can see a movie, have dinner and shop, all under one roof,” Silberfein said in the conference call. “And that’s really resonating both with the shoppers as well as the retailers.”
Hayley Cook, a spokeswoman from Rouse Properties, said she could not comment beyond the information in the fourth-quarter report and the last earnings call.
The company will release its next quarterly report May 5. A conference call with analysts about the report is scheduled that day for 5 p.m.
(Megan Doyle can be reached at 369-3321 or firstname.lastname@example.org or on Twitter @megan_e_doyle.)