SITE Centers Disposes Shopping Centers for $714M, Acquires for $111M

SITE Centers Corp. SITC has provided an update on its transaction and financing activities in the third quarter of 2024 through Sept. 17, 2024. It also issued an updated projected SITE Centers and Curbline Properties balance sheet information.

In a recent update, SITE centers disclosed that from the beginning of the third quarter of 2024 through Sept. 17, 2024, it has sold 13 wholly-owned shopping centers for $714.3 million. This retail REIT also purchased six convenience properties for a gross price of $111.2 million. This included the recent purchase of Loma Alta Station in San Diego, CA and Nine Mile Corner in Denver, CO.

Net proceeds from selling 13 wholly owned properties were used to repay $159 million of the $530 million SITE Centers’ mortgage facility.

SITE Centers has been following an aggressive capital-recycling program through which it is divesting slow-growth assets and redeploying the proceeds for the acquisitions of premium U.S. shopping centers. These centers offer strong opportunities for rent growth and redevelopment activities.

SITC & Curbline Spin-Off Update

Curbline is anticipated to be funded with $600 million in cash at the time of the spin-off, alongside a $400 million undrawn, unsecured line of credit and a $100 million unsecured, delayed draw term loan, while carrying no debt.

Due to the asset disposition activities conducted through Sept. 17, 2024 and additional assets under contract, the company may enhance Curbline’s capitalization with more cash, contingent upon the completion of additional asset sales expected to close before the spin-off.

SITC Strengthens Balance Sheet Position

SITC’s transaction and financing activities relieve pressure off the company’s balance sheet while paving the way for top-line and cash-flow growth and adding value to the portfolio in the long term.

However, given the conveniences of online shopping, growing e-commerce adoption is concerning for SITE Centers. Potential tenant bankruptcies in the near term could affect its profitability and hurt occupancy.

In the past six months, shares of this Zacks Rank #3 (Hold) company have gained 5.1% compared with the industry’s growth of 9.7%.

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Stocks to Consider

Some better-ranked stocks from the retail REIT sector are Brixmor Property Group BRX and Tanger, Inc. SKT, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Brixmor Properties’ 2024 FFO per share has moved marginally northward over the past two months to $2.13.

Story continues

The Zacks Consensus Estimate for Tanger’s ongoing year’s FFO per share has been raised 1.5% upward over the past two months to $2.09.

Note: Anything related to earnings presented in this write-up represent funds from operations (FFO), a widely used metric to gauge the performance of REITs.

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