Vornado Realty Trust Acquires Market Square Showroom Complex in High Point for $100 Million

Strategic Insights -

High Point businessmen Jacob Froelich, Dave Phillips, and George Lyles have agreed to sell the Market Square showroom complex and two other furniture showrooms to Vornado Realty Trust, a New Jersey-based real estate investment trust. The $100 million purchase includes 1 million square feet of showroom space, an eighth of all showroom space downtown, and is expected to be closed by September 30. The deal will not result in any layoffs, with Froelich continuing to manage Market Square locally. The tenants' leases will also be honored.

Key Takeaways:

  • The acquisition marks a significant investment in High Point by a nationally respected player, further solidifying the city's status as the furniture capital of the world.
  • Vornado Realty Trust brings significant financial and management strength to the deal, which is expected to add comfort to City Hall and the local community.
  • There will be no layoffs, and Market Square will continue to be managed locally by Froelich, ensuring a voice of experience to guide the complex.
  • The purchase includes 1 million square feet of showroom space, representing an eighth of all showroom space downtown, and includes the Hamilton Market, Sklar-Peppler, and Furniture Plaza showrooms.
  • Vornado has assumed $45 million in debt on the properties, in addition to paying $55 million in stock to the sellers.
  • The deal is tax-free, and will allow the properties to continue operating as they have been, with minimal noticeable changes.
  • The purchase agreement includes a climate-controlled walkway connecting the properties, as well as a management team with expertise in the furniture industry.
  • Vornado's parent company, Merchandise Mart Properties, will manage Market Square and the other showrooms, leveraging its resources in Chicago to improve the properties and the International Home Furnishings Market.

Statistics:

  • The Deal: $100 million
  • Showroom Space: 1 million square feet
  • Percentage of Showroom Space: 1/8 of all showroom space downtown
  • Properties Involved: Market Square, Hamilton Market, Sklar-Peppler, Furniture Plaza
  • Assumed Debt: $45 million
  • Sale Price: $55 million in Vornado stock
  • Revenue: $245 million (last year's sales for Vornado Realty Trust)
  • Employees: 190
  • Locations: 7 states (nearly 60 shopping centers)
  • Office Buildings: 14 (in or around New York City)

Sources:

  • "Three High Point businessmen selling Market Square showroom complex, other properties for $100 million," _High Point Enterprise_ (no date specified)
  • _Vornado Realty Trust_ (no date specified)
  • _Merchandise Mart Properties_ (no date specified)
  • _International Home Furnishings Marketing Association_ (no date specified)
  • _Old Hickory Furniture Co._ (no date specified)
  • _Franklin Place furniture company_ (no date specified)