DDR Divests Assets Worth $87M - Analyst Blog
July 06 2011 - 1:50PM
Zacks
Developers Diversified Realty Corporation (DDR)
recently divested 12 non-prime assets and 4 land parcels for $112
million, of which the company's share was $87 million.
Developers Diversified sold non-strategic assets to improve its
portfolio demographics and increase liquidity. Additionally, the
company is also set to sell some other assets, which would generate
proceeds of approximately $93 million for the company.
Developers Diversified intends to acquire two shopping centers
for $85 million during the third quarter of 2011. The company plans
to use the proceeds from the disposition of assets to fund the
acquisition of the two shopping centers.
Developers Diversified is continuing with its portfolio
repositioning program as it focuses on higher growth markets
characterized by better job and rent growth prospects.The company’s
strategy is to decrease its exposure in the non-prime assets.
The company seeks to invest capital derived from this
transaction for the acquisition of the shopping centers, which has
strong long-term prospects and thereby enhance the overall quality
of the company’s portfolio.
Headquartered in Beachwood, Ohio, Developers Diversified is a
real estate investment trust (REIT), which acquires, owns,
develops, leases and manages shopping centers and business centers
across 41 states in the U.S., along with Puerto Rico, Brazil and
Canada.
The company has initiated a strategic shift from neighborhoods
(non-anchor type strip malls) to community centers, which have
begun to blur the line between traditional malls and strip retail
centers.
Developers Diversified has a well-diversified portfolio
concentrated mostly in the high growth areas of the country,
including Florida, California, Texas and North Carolina. With a
focus on best-in-class retailers in strategic locations, the
company’s portfolio drives value and mitigates operating risks by
generating a relatively steady revenue stream.
Developers Diversified currently retains a Zacks #2 Rank, which
translates into a short-term Buy rating. We are also maintaining
our long-term Neutral recommendation on the stock. One of its
competitors, Kimco Realty Corporation. (KIM)
currently retains a Zacks #3 Rank, which translates into a
short-term Hold rating.
DEV DIVERFD RLT (DDR): Free Stock Analysis Report
KIMCO REALTY CO (KIM): Free Stock Analysis Report
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