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Federal Realty Unlocks Value, Sells Levare Apartments at Santana Row

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Federal Realty Investment Trust (FRT - Free Report) has announced the sale of Levare, a 108-unit residential building within Santana Row, San Jose, CA, for $74 million to unlock value and deploy capital in long-term accretive investments.

Delivered in 2011, Levare, a high-quality multifamily asset, has played a significant role in the evolution of Santana Row. The property was 95% leased at the time of sale.

Spanning 2.5 million square feet across retail, office, residential and hotel uses in San Jose, CA, Santana Row is a well-known mixed-use destination in Silicon Valley. It has 50 shops, 30 restaurants, 662 rental homes, 219 privately owned condominiums, a 215-key boutique hotel and around 1 million square feet of Class A office space, including the adjacent Santana West as its neighborhood. Serving as a major attraction, Santana Row has emerged as a key contributor to Federal Realty’s long-term value accretion, with 8.5 million annual visits, demonstrating sustained demand across asset classes.

Due to this sale, Federal Realty will be able to enhance its focus on key markets and boost its financial flexibility, allowing it to invest in high-performing assets that align more closely with its long-term growth objectives.

Federal Realty’s portfolio of premium retail assets in well-off communities with favorable demographics positions it well for growth. A diverse tenant base and a focus on essential retail ensure stable cash flows. Efforts to diversify its portfolio and develop mixed-use assets are likely to benefit the company over the long term. Its strategic portfolio rebalancing in the premium market bodes well for future growth. However, higher e-commerce adoption and potential tenant bankruptcies remain concerns.

Shares of this Zacks Rank #3 (Hold) company have fallen 8.3% in the past three months, wider than the industry's decline of 5.9%.

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Stocks to Consider

Some better-ranked stocks from the broader REIT sector are Welltower (WELL - Free Report) and Cousins Properties (CUZ - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Welltower’s 2025 FFO per share has moved marginally northward to $4.99 over the past month.

The consensus estimate for Cousins Properties’ 2025 FFO per share has increased 1.8% to $2.79 over the past two months.

Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.


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