Equity One Acquires Assets - Analyst Blog

Equity One Inc. (EQY), a real estate investment trust (REIT) engaged in the ownership, management, and development of neighborhood and community shopping centers in the U.S., has recently decided to acquire three shopping centers in Long Beach, California, for $72 million.  

The acquisition is part of the long-term strategy of the company to own high-quality malls in major metropolitan markets with high population density, supply constraints and strong tenant sales. The properties spanning 273,000 square feet of retail space are currently 97% leased. The shopping centers are strategically located in the retail hub of the Long Beach traffic circle that has a population of 259,624 within a 3-mile radius, with an average household income of $70,401.

As of September 30, 2010, Equity One owned 189 properties spanning 19.5 million square feet of space. The majority of the shopping centers owned by Equity One are anchored by leading supermarkets, pharmacies and large retail stores. The company has a diverse tenant mix – a hedge against tenant concentration risk, thereby ensuring a steady source of income.

In addition, bulk of the company's portfolio is located in some of the most densely populated and highest growth areas of the country with high barriers to entry. These include the metropolitan areas around Miami, Fort Lauderdale, West Palm Beach, Jacksonville, Orlando, Atlanta, Georgia, Boston and New York. Consequently, the shopping centers generate relatively strong sales with solid trade area demographics.

We have a ‘Neutral' rating on Equity One, which presently has a Zacks #3 Rank translating into a short-term ‘Hold' rating and indicates that the stock is expected to perform in line with the overall U.S. equity market for the next 1–3 months. We also have a ‘Neutral' recommendation and a Zacks #3 Rank for Kimco Realty Corporation (KIM), a competitor of Equity One.

 
EQUITY ONE INC (EQY): Free Stock Analysis Report
 
KIMCO REALTY CO (KIM): Free Stock Analysis Report
 
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