The Motley Fool Discussion Boards

Previous Page

Industry Discussions / Real Estate Inv. Trusts: REITs


Subject:  Anyone following KIM Date:  3/8/2020  11:56 PM
Author:  Valuemongeragain Number:  85597 of 86760

Just curious if anyone is following KIM.

I sold out about a year ago.

The most interesting thing that I notice about them in the last year is that they bought/retired $575 million worth of 3 series of preferred stock with a blended rate of 5.69%.

They issued $375 million of 30 year debt at 3.75%. As good as that rate seems, it would probably be better today. They issued $200 million in common stock in 4Q2019 at above $20 a share, versus its close Friday at $17.33.

They seem to be approaching the end of their previously large development/redevelopment program with about $40 million remaining in development and about $66 million in redevelopment. Completing this program will free up much cash. I am sure that redevelopment will continue to occur in the future, but hopefully at a slower pace.

Occupancy is quite good at 96.4%. In reviewing the top 50 tenants list, I identified three weak tenants - Petco 1.1% of ABR, Pier 1 (just took bankruptcy) at 0.5% ABR and Sears/Kmart at 0.4% ABR. Since the Sears/Kmart occupy 1.6% of GLA there might be opportunity there, but Eddie Lampert will try to extract the maximum value there for himself.

This is the way I see the pros and cons: Pros - Good occupancy, lower costs of capital (debt & preferreds) and coming to an end development/redevelopment program. Con - Bad economy could hurt occupancy.

Any opinions on KIM?

If it drops this week I might buy in the $16's and would be more likely in the $15's, should that opportunity arise.
Copyright 1996-2021 trademark and the "Fool" logo is a trademark of The Motley Fool, Inc. Contact Us