One of the leading retail real estate investment trusts
Kimco Realty Corp.
), disclosed its third-quarter 2013 transaction activities.
During the quarter, the company acquired assets worth $37.6
million, while its divestitures amounted to about $854.2
Q3 Transactions in Details
During the third-quarter, Kimco bought two U.S. assets -
Village at Highlands Ranch II and ElmsfordCenter - in Colorado
and New York, respectively. Littleton-based Village at Highlands
Ranch II is part of an interrelated retail complex that is
occupied by the area's dominant grocer, King Soopers - a
supermarket brand of
The Kroger Co.
). The mortgage-free retail center positioned in a prosperous
Denver suburb was bought for $14.6 million.
On the other hand, Elmsford Center that is located in the New
York metro suburb was acquired for $23 million. The power center
is anchored by
Bed Bath & Beyond Inc.
) and Sports Authority. Both the assets are positioned in upscale
communities, with a three-mile average household income of
$121,000 and $123,000, respectively.
In addition, Kimco and its JV partner - American Industries -
divested their stake in 84 Mexican industrial assets for $603.5
million. The properties were sold to Terrafina - a Mexican REIT.
Moreover, Kimco offloaded a 4-property Mexican shopping center
portfolio to its local operating partner, Planigrupo, for $84
million (1.1 billion Mexican pesos).
In addition, Kimco sold its 43% stake in a Guadalajara,
Mexico-based asset Centro Sur shopping center for $41 million
(523 million Mexican pesos). Also, the company divested its 50%
stake in a Chile-based 9-property shopping center portfolio to
its local operating partner for $50.2 million (25.3 billion
Chilean pesos). Additionally, Kimco had vended 8 assets of its
U.S. shopping center portfolio for $75.5 million.
Subsequent to Quarter-end Events
Following the third quarter-end, Kimco bought 2 shopping
centers - Northridge Shopping Center (Arvada, Colo.) and Five
Forks Crossing (Lilburn, Ga.) - for a total price $29.6 million.
Notably, since 2010, Kimco has acquired 70 properties in highly
affluent areas of the U.S. for $1.7 billion.
Also, Kimco disposed its 31.7% interest in a Las Palmas,
Texas-based asset to its joint venture partners for $99.9
million. With this, since the initiation of the U.S.
non-strategic retail disposition program in 2010, Kimco has sold
130 properties for $1.1 billion. Of this, Kimco's share of the
proceeds was $615.1 million.
Kimco's successful efforts to improve its core portfolio
through the divestiture of non-strategic assets and acquisition
of high-quality properties are commendable. This augurs well for
its earnings going forward as the properties are positioned
mostly in high-income, high-growth areas. Moreover, the high
credit tenant retention limits the downside risk and provides a
long-term steady source of income for the company.
Kimco is scheduled to release third-quarter 2013 results on
Oct 29, 2013, after the closing bell. The Zacks Consensus
Estimate for third-quarter funds from operations (FFO) is
currently pegged at 33 cents per share, representing a
year-over-year increase of 6.24%.
Kimco currently carries a Zacks Rank #2 (Buy). Another retail
Regency Centers Corporation
) is performing well and has the same rank as Kimco.
Note: FFO, a widely accepted and reported measure of the
performance of REITs is derived by adding depreciation,
amortization and other non-cash expenses to net income.
BED BATH&BEYOND (BBBY): Free Stock Analysis
KIMCO REALTY CO (KIM): Free Stock Analysis
KROGER CO (KR): Free Stock Analysis Report
REGENCY CTRS CP (REG): Free Stock Analysis
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