MACQUARIE DDR TRUST- MERVYNS UPDATE18 August 2008Macquarie DDR...

MACQUARIE DDR TRUST- MERVYNS UPDATE
18 August 2008
Macquarie DDR Trust (ASX: MDT) notes that Mervyns, one of its tenants, has announced progress with re-alignment of its business operations including details of planned store closures.
Mervyns has announced plans to close 26 of its 176 stores of which eight of the stores to be closed are leased from Macquarie DDR. The store closures and resulting liquidation sales of stock are subject to the approval of the court overseeing Mervyns’ bankruptcy. If approved, Mervyns have indicated that the closures will be completed by November 2008.
The eight closing Mervyns stores leased from Macquarie DDR are located in California (3), Arizona (1), Nevada (3) and Texas (1) and cover 614,334 square feet (3.7% of Macquarie DDR’s gross lettable area) or approximately 2.0% of Macquarie DDR’s share of gross rental income. Of the eight stores, six are located in shopping centres and two in malls, anchored by such national chains as Wal-Mart, Target, Sears and Toys R’ Us. At present, Mervyns has not rejected any of the eight leases through its bankruptcy case, or requested rent relief for any location within the Trust’s portfolio. Mervyns remains fully up-to-date with rental payments for all leases with the Trust.
Mervyns currently has 37 leases within the Macquarie DDR portfolio covering 2.8 million square feet and representing approximately 10.6% of the Trust’s annual base rental income. The eight stores proposed for closure are located within predominantly infill locations with high population densities which would potentially be attractive to new tenants.