French mall developer Unibail-Rodamco-Westfield has sold The Village, an outdoor “lifestyle” shopping center in Woodland Hills, to a company led by Rams owner Stan Kroenke for $325 million.

It marks the latest move in URW’s exit from the U.S. retail market. The development company plans to sell all 24 of its U.S. properties, valued at about $13 billion, by the end of 2023 and place more focus on its European assets.

The second largest transaction

The Village deal, announced Tuesday, Dec. 27, is the nation’s second largest shopping center transaction this year, URW officials said. It was second only to the August sale of URW’s Santa Anita mall, which sold for nearly $538 million to Wen Shan Chang, a Southern California real estate investor.

The 600-square-foot Village property was built in 2015 and is located next to the 34-acre Promenade development site, which URW recently sold to a private investment group that includes Kroenke’s company for $150 million. That transaction fueled speculation that Kroenke could move his team there and build a year-round practice facility on the property.

Westfield Topanga, URW’s flagship property in the area, was not part of the latest transaction.

In 2020, the Los Angeles City Council came up with a plan to redevelop some of the land as an entertainment, sports, dining and residential center.

Generating capital, reducing debt

With the sale of The Village, URW has made $1.1 billion in proceeds to date from the selloff of financial assets in the U.S. that are being used to generate capital and reduce company debt. The asset-reduction plan also includes the sale of the Palisade residential building in San Diego for $238 million and the ownership transfer of five other regional properties.

Fabrice Mouchel, URW’s chief financial officer, said the The Village sale is moving the company in the right direction.

“This transaction is another step in the streamlining of our US regional asset portfolio as part of our wider plan to radically reduce our financial exposure to the US, and demonstrates the continued investor interest in high quality assets with strong operating performance,” Mouchel said in a statement.

URW operates 80 shopping centers in 12 countries, including 45 which carry the iconic Westfield brand. They attract more than 900 million visits annually.

The company also has a portfolio of offices, 10 convention and exhibition venues in Paris, and a $3 billion development pipeline, primarily of mainly mixed-use assets. URW’s current portfolio is 87% in retail, 6% offices, 5% convention and exhibition venues and 2% in services, the company said.

Kroenke’s company has developed several retail, apartment and sports facilities over the past 40 years, the most recent being the $5.5 billion SoFi Stadium in Inglewood, home to the NFL’s Rams and Chargers.

The Kroenke Organization owns and operates retail centers in 39 states totaling 40 million square feet.

Malls on the decline

U.S. malls have seen declining foot traffic amid a dramatic increase in online shopping, a decline in visitors to department stores, and more recently, the COVID-19 pandemic, which kept many consumers home.

The nation was home to about 2,500 malls in the 1980s, but that has since shrunk to 700. And 10 years from now there will only be about 150 left, Nick Egelanian, president of retail consulting firm SiteWorks, told The Wall Street Journal.

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The malls that will survive will be in premium locations, Egelanian said, with entertainment, dining and luxury stores.