Kimco expands its Sun Belt presence with purchase of RPT Realty

Kimco Realty, which bills itself as the largest owner of grocery-anchored shopping centers in the nation, has added new credence to that claim.

The Jericho, N.Y.-based company this week closed on the acquisition of RPT Realty that it announced was in the works in August. The deal adds 56 open-air centers to Kimco’s portfolio, which as of now will number 570 properties. 

The $2 billion all-stock deal adds some 13 million sq. ft. of gross leaseable area, bringing its total holdings to more than 100 million sq. ft. It also strengthens the company’s focus on Sun Belt centers, a prime motivation for Kimco’s $5.9 billion purchase of Weingarten Realty in 2021.

“Certain markets in the South don’t pose heavy barriers to entry for new supply,” Kimco president Ross Cooper told Chain Store Age following that acquisition. “In many of our other markets, like the Northeast and the Mid-Atlantic, it’s harder to get approval for development.”

One key Sun Belt asset acquired by RPT in 2022 was Mary Brickell Village, a 200,000 sq. ft. grocery anchored property in Miami’s Brickell City, the billion-dollar, luxury-class neighborhood that Swire Properties opened in 2016.

“This transaction presents another exciting opportunity for our company to deepen our presence in key Coastal and Sun Belt markets, while accelerating our growth at an attractive valuation,” said Kimco CEO Conor Flynn when Kimco announced its intent to acquire RPT last summer . “Approximately 70% of RPT’s portfolio aligns with our key strategic markets. Furthermore, their substantial pipeline of signed, but not yet open leases and 20% or greater mark-to-market leasing spread across the portfolio, will drive higher growth for the combined company.”

The deal also aligns Kimco with the Singapore-based GIC wealth fund, which in 2019 forged a deal with RPT to invest more than $300 million in open-air shopping centers in the U.S.

“We’re excited to combine GIC's extensive history of real estate investing with Kimco's deep expertise as a leading owner and operator of open-air shopping centers and mixed-use assets in the U.S., to continue delivering on the strong long-term opportunities in this space," said GIC’s head of Americas real estate in a press release.