Klaff Realty, LP in a joint venture with Developers Diversified Realty (NYSE: DDR) and Lubert Adler Funds, has been awarded asset designation rights for all of the retail real estate interests of the bankrupt estate of Service Merchandise Corporation for approximately $235 million.

The Service Merchandise portfolio consists of approximately 213 Service Merchandise Retail sites, across 31 states, totaling approximately 12.4 million square feet.  The venture rejected 73 leaseholds and/or allowed the lease terms to end prior to the expiration of the designation period.