GE Capital Real Estate officials say that the equity funding of the Kimco Realty Opportunity Portfolio is an 80-20 split, with GE Capital Real Estate supplying $200 million in equity and Kimco kicking in $50 million. While sources say that the joint venture partnership could have a total value of approximately $1 billion, officials with GE Capital Real Estate and Kimco refused to discuss the joint venture's total value.
Unrelated to its joint venture with GE Capital Real Estate, Kimco does operate Kimco Income REIT, a joint venture with institutional partners that at the end of the second quarter of this year owned 57 community retail shopping centers in 19 states that had total assets of more than $1.1 billion. On August 13, Kimco reported that it had acquired five shopping centers totaling $98.2 million for the Kimco Income REIT.
The initial funding for its venture with GE Capital Real Estate--the Kimco Retail Opportunity Portfolio--consists of a shared equity pool established by the two partners. Kimco will handle the management and leasing of properties acquired by the joint venture. GE Capital Real Estate and Kimco will jointly identify properties to acquire as well as structure financing for the acquisitions. Officials with the joint venture relate that it will seek to acquire "established, high-potential retail properties in the U.S."
To date, no purchases have been made, although Scott Onufrey, director of investor relations for Kimco, says, "We have been pursuing some acquisitions with this venture in mind."
"The goal of our strategic ventures group is to build a strong, diversified real estate equity portfolio," comments Michael Pralle, president and chief executive officer of GE Capital Real Estate. "This transaction allows us to balance our current investments through exposure to neighborhood and community properties, which currently represent a very stable asset class. This venture also expands our offering to customers in this property type to now include equity."
Milton Cooper, Kimco's chairman and chief executive officer adds, "This initiative combines GE Capital Real Estate's capital strength and industry expertise with our track record of acquiring, developing and managing neighborhood and community shopping centers. Together, we have the ability to acquire properties with high growth potential--and commit the resources necessary to upgrade their performance." The joint venture will be looking to acquire shopping centers that need to be rebuilt, redeveloped or re-tenanted, officials with the Kimco Retail Opportunity Portfolio say.
GE Capital Real Estate has a portfolio of $21 billion through structured finance, equity and capital marketed products. Kimco, a publicly traded REIT, an owner and operator of community shopping centers, has interest in more than 510 properties in 41 states that total approximately 68 million sf of leaseable space.
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John Jordan
John Jordan is a veteran journalist with 36 years of print and digital media experience.
