Development

Sears Names Concord Pacific as Developer for Metrotown Property

From CNW – Sears Canada Inc. (TSX: SCC) is announcing today that it has entered into a binding agreement with Concord Pacific Group of Companies (“Concord”) to pursue the development of the Sears site located at the Metropolis at Metrotown in Burnaby, British Columbia.  Closing under the agreement is conditional upon satisfaction of conditions such as site investigations, strategic considerations relating to the project, and obtaining the approval from the City of Burnaby for the project, which is expected to take some time.  On June 7, 2013, Sears announced that it had submitted an application to the City of Burnaby regarding nine acres of the Company’s property on and adjacent to its store at that location.

Sears

In its June 7 announcement, Sears stated it was seeking approval to develop a comprehensive mixed-use project including the construction of a new Sears department store to replace the existing store.  The vision of the redevelopment is a major urban-infill project consisting of seven residential and office high-rises along with ground-level retail. Concord brings its development experience, depth and diversity to the joint arrangement. Concord develops comprehensive multi-phased urban communities across Canada including Concord Pacific Place in Vancouver and CityPlace in Toronto, Canada’s largest and second largest urban communities respectively.

The arrangement contemplates the sale of a 50% interest in the site for a value of approximately $140 million, subject to adjustments, and the retention of Concord on customary terms to manage most facets of the development.  $15 million of the purchase price is to be paid in cash on closing, with the balance represented by an interest-free long term note secured by Concord’s 50% interest in the property, the principal of which is expected to be repaid out of cash flow over time.
October 15, 2013by david.taylor@colliers.com