Inland REITís Purchase of Eight Shopping Centers Sets Up Possible Stock Listing | REITs Message Board Posts


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Msg  15211 of 15362  at  5/27/2022 8:48:04 AM  by

passandshoot


Inland REITís Purchase of Eight Shopping Centers Sets Up Possible Stock Listing

 

Inland Real Estate Income Trust bought eight grocery-anchored centers from affiliate Inland Retail Property Fund for $278.2 million, boosting the quality of its property portfolio and setting up the nontraded real estate investment trust to become the latest business of its kind around the country to have a public stock listing.

The 686,851-square-foot portfolio is 89% leased to 110 tenants, including a range of top-tier grocers such as Whole Foods, Ralphs, Sprouts Farmers Market, Trader Joe’s and Giant Food.

About 94% of annualized rent for this portfolio comes from grocery-anchored properties, and the average annualized rent is a strong $25.88 per square foot, according to Inland REIT. Grocery-anchored properties are in demand nationwide after the onset of the pandemic showed their ability to lure foot traffic.

The deal “supports our strategic plan of enhancing stockholder value in anticipation of a future liquidity event,” Mitchell Sabshon, president and CEO of the Oak Brook, Illinois-based REIT, wrote in a letter to shareholders filed with the Securities and Exchange Commission.

The REIT has been pursuing a strategic plan that includes providing a way for current investors to cash out and creating long-term stockholder value. In the past year, two other nontraded REITs owning grocery-anchored centers have pursued similar strategies, and both led to public stock listings.

Inland’s plan centers on owning a portfolio of grocery-anchored properties with lower exposure to big-box retailers — a sector it has been trying to reduce its holdings in since 2018.

Facing Challenges

That plan faces new obstacles this year as the Federal Reserve has raised the cost of borrowing money and Russia invaded Ukraine, two events that brought new volatility to the stock market.

The new acquisition is designed to boost the REIT’s portfolio metrics, making it more attractive to investors, Sabshon wrote.

Inland REIT’s percentage of annualized rent from grocery store tenants increased while further reducing its exposure to big-box retail centers.

The REIT grew to $1.4 billion in total assets comprising 52 properties and approximately 7.2 million square feet.

The acquisition moved Amazon and Sprouts up in the list of its top tenants and increased the REIT’s nationwide footprint.

The properties acquired were:

 


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