Kimco Realty beats second-quarter revenue estimates on strong leasing demand from grocers

Kimco Realty

27/07/2023 12:31

July 27 (Reuters) - Kimco Realty Corp  KIM.N  beat Wall
Street expectations for second-quarter revenue on Thursday,
benefiting from higher rental rates and resilient demand for
space in its grocery-anchored shopping centers.  
    The commercial real estate investment trust has been able to
protect its profits from the impact of higher borrowing costs as
the increased rentals failed to quell demand for its properties.
    The company's reported funds from operations (FFO) per share
came in at 39 cents, in-line with analysts' estimates, as per
Refinitiv data.    
    Kimco has its shopping centres concentrated in
high-barrier-to-entry markets and suburbs in major metropolitan
cities, which has led to strong demand from grocers and
retailers benefiting from stable markets for essential goods. 
    Occupancy rate rose by 70 basis points to 95.8% in the
quarter ended June 30, compared with a year earlier.
    Kimco also raised the low end of its full-year forecast for
funds from operations to $1.55 to $1.57 per share, the mid-point
of which meets Wall Street expectations. That compared to
company's prior forecast range of $1.54 to $1.57 FFO per share. 
        
    Its total revenue of $442.8 million beat analysts' average
estimate of $434.8 million. Net revenue from rental properties
was $439 million in the second quarter. 
    Data from Placer.ai showed that grocery-anchored shopping
centers have performed better than other shopping centers.
    Shopping center REITs are less exposed to store closure
threats from growing online sales, analysts at UBS said. 
  

 (Reporting by Juveria Tabassum in Bengaluru; Editing by Shweta
Agarwal)
 ((Juveria.Tabassum@thomsonreuters.com;))