Pearlridge mall buyout brings big businesses

PEARL CITY—Pearlridge Center, the second-largest mall in Hawaii after Ala Moana, is in new hands as two big “mainland” companies finish the buy for a little over $240 million. The big exchange is already bringing some notable changes for Pearlridge shoppers.

The 38-year-old mall, which consists of over 1.1 million square feet, saw several new retail stores open for the summer. Abracadabra, an accessories and hat store, and Gold Buyers Hawaii opened last week and there are plans for a Panda Express and Blue Hawaii Surf retail shop to open later this month.

“Whenever there is a vacant space we push to fill it because we want to keep offering more for the people,” said Fred Paine, general manager of Pearlridge Center.

The biggest addition was retail giant Bed Bath and Beyond. Dozens of shoppers stood in line early Thursday morning in front of what was once Circuit City. Bed Bath and Beyond, the first in Hawaii, opened its doors to the public with 65,000 square feet of store to roam. Hawaii is the last state to receive the linen, cookware, and home goods store.

“When Circuit City went bankrupt and left, we had this huge hole to fill,” Paine said. “We were lucky to convince Bed Bath and Beyond to come and they did. We are really lucky for them to come, especially in this really bad economy they took the gamble.”

Blackstone Group LP of New York and Glimcher Realty Trust of Ohio are closing the deal with previous owner Northwestern Mutual Life Insurance Company.

The deal includes both uptown and downtown phases, as well as the building that houses the Toys R Us toy store. The deal also includes about 100,000 square feet of office space. Adjacent buildings occupied by Inspiration Furniture, Borders, and Price Busters are not part of the sale.

The acquisition is the first Blackstone and Glimcher have made since forming their partnership in March. The contract is signed but the deal has yet to be officially closed. MMI reality services, managers of the Pearlridge property, were unavailable for comment on the deal.

The Wallstreet Journal’s Kris Hundson comments that the Pearlridge Center deal “illustrates how deep-pocketed buyers, often teamed with experienced property managers, are on the prowl for commercial real estate.”

Blackstone and Glimcher are actively looking for a new mortgage to put on Pearlridge, according to The Wallstreet Journal. Glimcher, a Columbus, Ohio-based real-estate investment trust that owns 26 U.S. shopping centers, last month raised $96 million by selling 16.1 million new shares to help finance the deal.

With Pearlridge being backed by big money, it’s only a matter of time before more of the country’s biggest retail outlets make the move to the islands—if they haven’t already.