Whitestone REIT (WSR) Completes $36M in Asset Sales Since Q3
As part of its ongoing asset management strategy, Whitestone REIT WSR announced the completion of roughly $36 million in property dispositions since the third quarter of 2022. With this move, WSR reaped $34 million in net proceeds after prorations and transaction costs.
According to Whitestone REIT’s CEO Dave Holeman, “We anticipate using the proceeds for debt reduction and future accretive acquisitions with greater upside than the properties which were sold.”
The properties sold included South Richey (Houston, TX), Bissonnet / Beltway (Houston), Desert Canyon (Phoenix, AZ), Pima Norte (Phoenix), Gilbert Tuscany Village Hard Corner (Phoenix) and Pad Site at Spoerlien Commons (Chicago, IL).
The combined sales were accomplished at a capitalization rate of 5.6%. This was based on the 2022 annualized nine-month property net operating income of around $2.0 million divided by the sales price. While occupancy for the combined group stood at 90.3%, the average base rent was $14.51.
The dispositions seem a strategic fit as these will help improve Whitestone’s debt metrics and offer flexibility in achieving growth in profitability.
WSR is engaged in the acquisition, ownership, operation and development of open-air, retail centers, mainly in the fast-growing, high-household-income markets in the Sunbelt like Phoenix, Austin, TX; Dallas-Fort Worth, Houston and San Antonio, TX. With superior trade area demographics, the Sunbelt markets are likely to help the company ride the growth curve.
This Zacks Rank #3 (Hold) stock has risen 15.1% so far in the quarter, outperforming the real estate market’s growth of 7.2%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Stocks to Consider
Some better-ranked stocks from the REIT sector are VICI Properties Inc. VICI and Lamar Advertising Company LAMR, each carrying a Zacks Rank #2 (Buy) at present.
The Zacks Consensus Estimate for VICI Properties’ 2022 FFO per share has moved 4.9% north to $1.92 over the past two weeks.
The Zacks Consensus Estimate for Lamar Advertising Company’s ongoing year’s FFO per share has been raised 1.4% over the past two months to $7.34.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO) — a widely used metric to gauge the performance of REITs.
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