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Acadia Realty's Rent Receipts Improve on Location Reopenings

Zacks Equity Research
·3 min read

Acadia Realty Trust AKR is seeing an improvement in billed cash rent collections at its Core portfolio, aided by business resumption as an increasing number of locations continue to reopen.

In fact, as of Sep 3, 2020, 86% and 93% of its pro-rata annual base rents (“ABR”) and gross leasable area (GLA) in the Core portfolio were open for business, respectively. This indicates progress from 82% and 88% of its pro-rata ABR and GLA, respectively, which were open for business as of July-end.

Notably, this supported the company’s rent collections. As of Sep 3, it collected Core portfolio cash on nearly 81% of pre-coronavirus rents and recoveries for July and August, and 73% for the second quarter.

This indicates an improvement from the second quarter and July 2020 cash collections of 71% and 74%, respectively, of billed Core rents and recoveries as of Jun 30.

Management noted, “We remain confident that our differentiated and diversified portfolio will navigate through this temporary dislocation and return to a position of stability and growth.”

Such improvement in rent collections will likely boost the company’s cash flow from operations for the third quarter.

However, shares of this Zacks Rank #4 (Sell) company have lost 23.1% over the past three months compared with the industry’s 3.6% decline.

 


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Understandably, businesses of physical stores widely depend on customer traffic but consumers are by and large avoiding crowded public spaces due to the pandemic and increasingly opting for online purchases. This, in turn, is taking a huge toll on tenants’ liquidity, thereby, making it difficult to meet their rental obligations. As a result, retail REITs, which have already been battling against store closures and bankruptcy issues, are feeling the heat. In fact, apart from Acadia, the downside is affecting other retail REITs, including Macerich MAC, Simon Property SPG and Kimco KIM.

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Kimco Realty Corporation (KIM) : Free Stock Analysis Report
 
Macerich Company The (MAC) : Free Stock Analysis Report
 
Simon Property Group, Inc. (SPG) : Free Stock Analysis Report
 
Acadia Realty Trust (AKR) : Free Stock Analysis Report
 
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