Weingarten Realty Investors
), a retail real estate investment trust (REIT), recently
acquired an Austin, Texas-based power center - Mueller Regional
Retail Center. The strategic move reflects the company's effort
to strengthen its overall portfolio and tenant base, through
high-end assets buy-out.
As a matter of fact, with solid projections for growth in
employment, population and rents in the next 5 years, Austin
remains a preferred market for Weingarten Realty. Situated
adjacent to Interstate 35, the power center spans 350,000 square
feet and is anchored by a cluster of renowned tenants - such as
The Home Depot, Inc.
Bed Bath & Beyond Inc.
The property offers substantial growth potential with trade area
population of 150,000 people and average daily traffic count of
more than 240,000 vehicles. Notably, this property is part of the
Mueller Regional Retail District, a 700 acre master planned
community. After completion, this community will boast of 4
million square feet of commercial space and 4,600 residential
On the other hand, Weingarten Realty is disposing its non-core
assets. During the third quarter, the company divested eight
non-core properties and two land parcels. These asset disposition
efforts have helped the company reap $116 million and $240
million, respectively, as its share of disposition proceeds for
the quarter and year-to-date.
We view the aforementioned acquisition as a significant
achievement for Weingarten Realty, given its superior
demographics with high household incomes, along with high
barriers to entry. We expect it to increase rental revenues and
thereby boost top-line growth in the future. On the other hand,
the divestitures would help reposition its portfolio efficiently
and ride on the growth curves.
Weingarten Realty currently carries a Zacks Rank #3 (Hold).
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