CLEVELAND, Dec. 21, 2012 /PRNewswire/ -- Forest City Enterprises, Inc. (NYSE: FCEA and FCEB) and the Arizona State Retirement System (ASRS) today announced the creation of a strategic capital partnership and a $400 million equity fund that will invest in multifamily development projects primarily in five core markets: New York City, Washington, D.C., Boston, Los Angeles, and San Francisco.
Funding for the venture will be 75 percent from ASRS and 25 percent from Forest City. The company estimates that more than two-thirds of its equity contribution to the fund is already represented by entitled development opportunities on its balance sheet. Equity from the fund will be paired with conventional project financing for an estimated aggregate development investment of approximately $800 million to $1 billion. Forest City will serve as fund manager.
"We are honored to have the Arizona State Retirement System as our partner in this new fund," said David J. LaRue, Forest City president and chief executive officer. "Their financial strength and investment acumen, combined with Forest City's multifamily development and management expertise, make this a powerful partnership that we believe will benefit stakeholders of both organizations. Activating existing entitlement gives our partnership clear advantages in the marketplace."
By executing on its strategy of securing strategic capital partners, Forest City expects to create ongoing opportunity for recognizing existing value and creating new growth for the company.
About Forest City
Forest City Enterprises, Inc. is an NYSE-listed national real estate company with $10.7 billion in total assets. The company is principally engaged in the ownership, development, management and acquisition of commercial and residential real estate and land throughout the United States. For more information, visit www.forestcity.net.
Safe Harbor Language
Statements made in this news release that state the company's or management's intentions, hopes, beliefs, expectations or predictions of the future are forward-looking statements. The company's actual results could differ materially from those expressed or implied in such forward-looking statements due to various risks, uncertainties and other factors. Risks and factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to, the impact of current lending and capital market conditions on its liquidity, ability to finance or refinance projects and repay its debt, the impact of the current economic environment on its ownership, development and management of its real estate portfolio, general real estate investment and development risks, vacancies in its properties, the strategic decision to reposition or divest portions of the company's land business, further downturns in the housing market, competition, illiquidity of real estate investments, bankruptcy or defaults of tenants, anchor store consolidations or closings, international activities, the impact of terrorist acts, risks associated with an investment in a professional sports team, its substantial debt leverage and the ability to obtain and service debt, the impact of restrictions imposed by its credit facility and senior debt, exposure to hedging agreements, the level and volatility of interest rates, the continued availability of tax-exempt government financing, the impact of credit rating downgrades, effects of uninsured or underinsured losses, effects of a downgrade or failure of its insurance carriers, environmental liabilities, conflicts of interest, risks associated with the sale of tax credits, risks associated with developing and managing properties in partnership with others, the ability to maintain effective internal controls, compliance with governmental regulations, increased legislative and regulatory scrutiny of the financial services industry, volatility in the market price of its publicly traded securities, inflation risks, litigation risks, cybersecurity risks and cyber incidents, as well as other risks listed from time to time in the company's SEC filings, including but not limited to, the company's annual and quarterly reports.
SOURCE Forest City Enterprises, Inc.
Robert O'Brien, Executive Vice President - Chief Financial Officer, +1-216-621-6060 or Jeff Linton, Senior Vice President - Corporate Communication, +1-216-621-6060