NEW HYDE PARK, NY-Kimco Realty Corp. said Monday it had increased its ownership interest in the Kimco-UBS joint venture comprising 39 shopping centers to 33% from its previous 18% interest. Simultaneously, affiliates of Blackstone Real Estate Partners VII completed their acquisition from affiliates of the UBS Wealth Management North American Property Fund for the remaining 67% ownership interest.
Both of these transactions valued the portfolio at $1.1 billion, including $631 million of assumed debt. The Wall Street Journal reported in February that Kimco would take on $104 million of that debt along with paying $61 million in cash.
The KUBS joint venture totals 5.6 million square feet and is currently 96% occupied, with rents averaging $15.51 per square foot. The portfolio is located across New York, Virginia, Texas, Florida, California and Maryland, concentrating on properties in high-barrier-to-entry markets such as New York City, Washington, DC and San Francisco.
Kimco says the portfolio is a balance between grocery-anchored shopping centers and dominant power centers. Tenants include grocery chains such as Publix, Giant Food, Whole Food Markets and Safeway, as well as Home Depot, Nordstrom Rack, Bed Bath & Beyond and T.J.Maxx. The shopping center REIT and UBS assembled it between 2005 and 2007.
In an earnings calls this past February, Kimco president and CEO David Henry called the KUBS properties “very high quality assets.” He added, “So we are very happy to be going from 18% to 33%, and we are happy to continue our role as the operating partner and should continue to be paid for that.”