SITE Centers Provides 2024 Transaction and Financing Update

Rhea-AI Summary

SITE Centers (NYSE: SITC), a major owner of open-air shopping centers in affluent suburban areas, has announced significant transaction and financing activities for Q2 2024. The company has sold two properties for $50.2 million, bringing total dispositions since June 2023 to $1 billion. Contracts to sell an additional $649.6 million in assets have been executed, with another $1.2 billion under due diligence or nonbinding agreements. These sales indicate strong portfolio quality and align with prior cap rate guidance. Capital from these sales has enabled SITE Centers to acquire two Convenience properties for $8.4 million and repurchase $15.9 million of senior unsecured notes at a discount. Future acquisitions include $78 million in contracts and $150 million in nonbinding agreements for Convenience properties. These activities support the planned spin-off of Curbline Properties.

Positive

• SITE Centers sold properties worth $50.2 million in Q2 2024.
• Total dispositions since June 2023 amount to $1 billion.
• Contracts to sell $649.6 million in assets have been executed.
• Additional $1.2 billion in assets under due diligence or nonbinding agreements.
• Sales indicate strong portfolio quality, consistent with cap rate guidance.
• Acquired two Convenience properties for $8.4 million.
• Repurchased $15.9 million of senior unsecured notes at a discount.
• Contracts to acquire $78 million in Convenience properties executed.
• Awarded over $150 million in nonbinding agreements for Convenience properties.

Negative

• No specific financial or business negatives were provided in the PR.

Insights

Financial Analyst

The news highlights significant activities surrounding property sales and acquisitions and financing actions. SITE Centers has been actively disposing assets, amassing a total gross sale price of $1.0 billion since June 30, 2023. This disposal strategy could indicate a shift in their portfolio management, possibly to reinvest in more profitable or strategic properties. Investors should note the capital recycling strategy, where proceeds from these sales are being used to acquire new assets and repurchase outstanding notes. Such actions suggest a focus on optimizing their balance sheet and improving financial flexibility. The acquisition of properties worth $8.4 million and planned acquisitions of $78.0 million worth of properties signal growth and potential future earnings. Additionally, the repurchase of $15.9 million of outstanding notes can reduce interest expenses, which is beneficial for cash flow. Investors should weigh these moves against the potential risks of asset disposals, such as the loss of rental income from sold properties.

Rating: 1 (Positive)

Real Estate Market Analyst

The disposal and acquisition activities by SITE Centers are indicative of a strategic pivot towards convenience properties, which might offer higher foot traffic and rental stability compared to traditional retail spaces. The reference to cap rates being consistent with prior commentary suggests that the market conditions and property valuations are stable, which is a positive signal for investors. The move to sell $1.0 billion worth of assets and the acquisition of new properties shows a proactive approach to capitalizing on market opportunities. Furthermore, the spin-off of Curbline Properties may streamline operations and focus on core strengths, potentially unlocking shareholder value in the long term. Investors should consider the implications of this strategic shift on SITE Centers' revenue streams and overall market position.

Rating: 1 (Positive)

Market Research Analyst

The proactive approach of SITE Centers in selling and acquiring properties while engaging in financial maneuvers such as note repurchases signifies a strong capital management strategy. The company's actions reflect confidence in its portfolio and the broader market environment. The successful sale of properties and the execution of new acquisition contracts paint a picture of a robust and dynamic organization adapting to market trends and positioning itself for future growth. The mention of the spin-off of Curbline Properties suggests a strategic focus on convenience properties, likely driven by consumer behavior shifts towards more accessible retail locations. Retail investors should observe how these moves will impact SITE Centers' market valuation and profitability metrics in upcoming quarters.

Rating: 1 (Positive)

BEACHWOOD, Ohio--(BUSINESS WIRE)-- SITE Centers Corp. (NYSE: SITC), an owner of open-air shopping centers in suburban, high household income communities, today provided an update on second quarter 2024 transaction and financing activity in connection with presentations at NAREIT’s REITweek Investor Conference.

“SITE Centers has closed on the sale of two properties in the second quarter to date for an aggregate gross sale price of $50.2 million bringing total dispositions since June 30, 2023 to $1.0 billion. In addition to completed sales to date, the Company has executed contracts to sell $649.6 million of assets where the general due diligence period has expired with an additional $1.2 billion of assets with executed contracts which remain subject to the completion of buyer’s due diligence or nonbinding letters of intent. Overall pricing levels for the completed and expected 2024 asset sales demonstrate the quality of the SITE Centers portfolio and are consistent with cap rate commentary provided during the Company’s first quarter 2024 results conference call,” commented David R. Lukes, President and Chief Executive Officer.

“Moreover, the pace and scale of dispositions has provided increased capital to acquire additional Convenience properties prior to the expected spin-off of Curbline Properties and to repurchase the Company’s senior unsecured notes at a discount to par. In the second quarter to date, SITE Centers has acquired two wholly-owned Convenience properties for $8.4 million and has repurchased $15.9 million of outstanding senior unsecured notes. Additionally, the Company has executed contracts to acquire $78.0 million of Convenience properties and has been awarded over $150 million of Convenience properties on a nonbinding basis highlighting the opportunity set identified with the October 2023 announcement of the spin-off of Curbline Properties.”

About SITE Centers Corp.

SITE Centers is an owner and manager of open-air shopping centers located in suburban, high household income communities. The Company is a self-administered and self-managed REIT operating as a fully integrated real estate company, and is publicly traded on the New York Stock Exchange under the ticker symbol SITC. Additional information about the Company is available at www.sitecenters.com. To be included in the Company’s e-mail distributions for press releases and other investor news, please click here.

Safe Harbor

The Company considers portions of the information in this press release, including statements with respect to future disposition activity and the expected spin-off of Curbline Properties, to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended. For this purpose, any statements contained herein that are not historical fact may be deemed to be forward-looking statements. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. There are a number of important factors that could cause our results to differ materially from those indicated by such forward-looking statements, including, among other factors, our ability to enter into agreements to sell properties; our ability to satisfy closing conditions applicable thereto; and our ability to complete the spin-off of Curbline Properties in a timely manner or at all. Other risks and uncertainties that could cause our results to differ materially from those indicated by such forward-looking statements include general economic conditions, including inflation and interest rate volatility; the loss of, significant downsizing of or bankruptcy of a major tenant and the impact of any such event on rental income from other tenants at our properties; and business and economic consequences (including the potential loss of rental revenues) resulting from extreme weather conditions, natural disasters or public health crises in locations where we own properties. For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements, please refer to the Company's most recent reports on Forms 10-K and 10-Q. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240603480331/en/

SITE Centers Corp.

Conor Fennerty, EVP and

Chief Financial Officer

216-755-5500

Source: SITE Centers Corp.

FAQ

What recent property sales has SITE Centers (SITC) completed in Q2 2024?

SITE Centers sold two properties for $50.2 million in Q2 2024.

How much has SITE Centers (SITC) gained from total dispositions since June 2023?

SITE Centers has gained a total of $1 billion from dispositions since June 2023.

What asset sale contracts has SITE Centers (SITC) executed?

SITE Centers has executed contracts to sell $649.6 million in assets.

What is the status of additional asset sales for SITE Centers (SITC)?

An additional $1.2 billion in assets are under due diligence or in nonbinding agreements.

What acquisitions has SITE Centers (SITC) made recently?

SITE Centers acquired two Convenience properties for $8.4 million in Q2 2024.

What repurchases has SITE Centers (SITC) made recently?

SITE Centers repurchased $15.9 million of senior unsecured notes at a discount.

What future property acquisitions are planned by SITE Centers (SITC)?

SITE Centers has contracts to acquire $78 million in Convenience properties and over $150 million in nonbinding agreements.