Federal Realty Sells Portion Of San Antonio Center For $155M
Zacks Investment Research | Dec 19, 2019 08:41PM ET
Federal Realty Investment Trust (NYSE:FRT) recently sold under threat of condemnation a portion of San Antonio Center, in Mountain View, CA, for $155 million. A school will be constructed by the Los Altos School District on the 11.7-acre sold land.
The regional shopping center, aggregating 35 acres, was acquired by the company in 2015 for $62.2 million.
Kohl's, Jo-Ann, 24 Hour Fitness, and other small shop tenants occupied the portion of the property sold. The company will pay out tenant condemnation awards from sale proceeds.
Per management, the sale indicates value of the company’s premium real estate portfolio, specifically in Silicon Valley. In fact, the company controls 140 acres of land in the region. This includes 2.4 million square feet of commercial space and 662 residential units.
Amid challenging retail real estate market, the company’s disposal move reduces its exposure to such assets. In fact, issues such as shift of consumers toward online channels, dwindling mall traffic, store closures and bankruptcy of retailers have been making headlines and kept retail REITs on tenterhooks. These have resulted in turbulence in the retail real estate market, forcing structural changes. Even the likes of Simon Property Group, Inc. (NYSE:SPG) , Kimco Realty Corporation (NYSE:KIM) and Macerich Company (NYSE:MAC) were not immune and have made aggressive attempts to adapt to the changing scenario.
Moreover, in the past year, shares of Federal Realty have underperformed the Zacks Investment Research
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