The retail real estate investment trust (:REIT), Regency Centers Corporation (REG) disclosed the completion of the previously announced redevelopment of an OR.-based premium shopping center – Greenway Town Center. Along with this, the company announced the outlet opening of its only grocer tenant, Whole Foods Market, Inc. (WFM), at the property today.
Regency incorporated various changes at Greenway Town Center – including exterior frontage modernization and upgrade of architectural components and enhancement of the parking space – to boost its quality. The company spent $6 million for refurbishment of the center.
Tigard-based, Greenway Town Center is positioned 12 miles southwest of Portland and serves the prosperous local population of over 137,000 in the area that connects Washington Square and Hwy 217 corridor. The shopping center, with a daily traffic of 37,000, was bought by Regency in 2005 in collaboration with GRI. Apart from Whole Foods, Greenway Town Center boasts several other prominent tenants such as Dollar Tree, Inc. (DLTR), McMenamins Pub, Cold Stone Creamery and Rite Aid Corporation (RAD).
We expect this strategic venture by the company to drive occupancy and tenant sales per square foot in the coming quarters. Regency primarily focuses on building a premium portfolio of grocery-anchored shopping centers, which are usually necessity driven and bring in a dependable traffic. Hence, this provides the company a considerable upside potential.
Earlier this month, continuing with its winning streak, Regency reported a positive earnings surprise of 6.15% in first-quarter 2014. The company’s first-quarter core funds from operations (core FFO) per share of 69 cents exceeded the Zacks Consensus Estimate by 4 cents and the year-ago quarter figure by 5 cents. Higher revenue growth aided the company’s results and this Zacks Rank #2 (Buy) stock raised its outlook for 2014.
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.