We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Regency (REG) Closes Equity One Merger, Joins S&P 500
Read MoreHide Full Article
In a major development in the Retail REIT industry, Regency Centers Corporation (REG - Free Report) declared closure of the Equity One merger deal, a move that has created a combined company with a total market capitalization of around $16 billion.
Specifically, Equity One has been merged with and into Regency, and the surviving entity – Regency Centers – joins the S&P 500 index today.
Merger Benefits
Notably, this merger, which is expected to be accretive to core FFO per share, creates a high quality portfolio of 429 properties, mainly grocery-anchored, for Regency. These properties are located in several top markets and offer solid scope for long-term growth.
Further, Regency estimates the combined portfolio to generate 3.0–3.8% growth in annual same property net operating income (NOI) for 2017 against the 2.25–3.0% growth the company had earlier projected for Regency as a stand-alone entity. Also, by 2018, Regency anticipates to realize around $27 million in annualized cost saves. This will primarily be recognized from the removal of duplicative corporate and property-level operating expenses.
The company would come up with its updated guidance, with more details, during the release of its first-quarter results.
Merger Terms
Per the terms of the Nov 2016 merger agreement, shareholders of Equity One are authorized to receive 0.45 of a newly issued share of Regency common stock for each Equity One shares owned, immediately before the effective time of the merger.
In addition, with the merger completion, Joseph Azrack, Chaim Katzman and Peter Linneman, former Equity One directors have been appointed to serve on Regency’s board. Particularly, the former Chairman of Equity One’s board – Mr. Katzman – will serve as non-executive Vice Chairman of the Regency’s board.
Our Take
Notably, Regency has considerable experience in the retail real estate industry, with 225 shopping centers’ development since 2000, denoting an investment at completion of over $3.5 billion. Further, Equity One enjoyed retail occupancy, excluding developments and redevelopments, of 95.8% as of Dec 31, 2016, and its tenant roster included national, regional and local tenants. Their merger would, therefore, aid in creating a pre-eminent grocery-anchored shopping center REIT with enhanced concentration in higher density, in-fill metro areas, and offer solid scope to Regency for expanding both top and bottom lines over the long term.
Shares of Regency outperformed the Zacks categorized REIT and Equity Trust – Retail industry over the past three months. During that time frame, shares of the company gained 3.9%, whereas the industry rose by 3.1%.
Key Picks
Investors interested in the REIT industry may consider stocks like EPR Properties (EPR - Free Report) , Urban Edge Properties (UE - Free Report) and Urstadt Biddle Properties Inc. . Each of these stocks carries a Zacks Rank #2 (Buy).
EPR Properties, currently, has long-term growth rate of 8.3%. Moreover, the Zacks Consensus Estimate for Urban Edge Properties’ funds from operations (FFO) per share for 2017 of $1.37 reflects 7.9% growth from the prior year. Further, Urstadt Biddle Properties has a long-term growth rate of 8.0%.
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income. All EPS numbers presented in this write up represent FFO per share.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Regency (REG) Closes Equity One Merger, Joins S&P 500
In a major development in the Retail REIT industry, Regency Centers Corporation (REG - Free Report) declared closure of the Equity One merger deal, a move that has created a combined company with a total market capitalization of around $16 billion.
Specifically, Equity One has been merged with and into Regency, and the surviving entity – Regency Centers – joins the S&P 500 index today.
Merger Benefits
Notably, this merger, which is expected to be accretive to core FFO per share, creates a high quality portfolio of 429 properties, mainly grocery-anchored, for Regency. These properties are located in several top markets and offer solid scope for long-term growth.
Further, Regency estimates the combined portfolio to generate 3.0–3.8% growth in annual same property net operating income (NOI) for 2017 against the 2.25–3.0% growth the company had earlier projected for Regency as a stand-alone entity. Also, by 2018, Regency anticipates to realize around $27 million in annualized cost saves. This will primarily be recognized from the removal of duplicative corporate and property-level operating expenses.
The company would come up with its updated guidance, with more details, during the release of its first-quarter results.
Merger Terms
Per the terms of the Nov 2016 merger agreement, shareholders of Equity One are authorized to receive 0.45 of a newly issued share of Regency common stock for each Equity One shares owned, immediately before the effective time of the merger.
In addition, with the merger completion, Joseph Azrack, Chaim Katzman and Peter Linneman, former Equity One directors have been appointed to serve on Regency’s board. Particularly, the former Chairman of Equity One’s board – Mr. Katzman – will serve as non-executive Vice Chairman of the Regency’s board.
Our Take
Notably, Regency has considerable experience in the retail real estate industry, with 225 shopping centers’ development since 2000, denoting an investment at completion of over $3.5 billion. Further, Equity One enjoyed retail occupancy, excluding developments and redevelopments, of 95.8% as of Dec 31, 2016, and its tenant roster included national, regional and local tenants. Their merger would, therefore, aid in creating a pre-eminent grocery-anchored shopping center REIT with enhanced concentration in higher density, in-fill metro areas, and offer solid scope to Regency for expanding both top and bottom lines over the long term.
Currently, Regency has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of Regency outperformed the Zacks categorized REIT and Equity Trust – Retail industry over the past three months. During that time frame, shares of the company gained 3.9%, whereas the industry rose by 3.1%.
Key Picks
Investors interested in the REIT industry may consider stocks like EPR Properties (EPR - Free Report) , Urban Edge Properties (UE - Free Report) and Urstadt Biddle Properties Inc. . Each of these stocks carries a Zacks Rank #2 (Buy).
EPR Properties, currently, has long-term growth rate of 8.3%. Moreover, the Zacks Consensus Estimate for Urban Edge Properties’ funds from operations (FFO) per share for 2017 of $1.37 reflects 7.9% growth from the prior year. Further, Urstadt Biddle Properties has a long-term growth rate of 8.0%.
Note: FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income. All EPS numbers presented in this write up represent FFO per share.
The Best Place to Start Your Stock Search
Today, you are invited to download the full list of 220 Zacks Rank #1 "Strong Buy" stocks – absolutely free of charge. Since 1988, Zacks Rank #1 stocks have nearly tripled the market, with average gains of +26% per year. Plus, you can access the list of portfolio-killing Zacks Rank #5 "Strong Sells" and other private research. See these stocks free >>