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Kimco Leverages Grocery Demand to Stay Ahead: Will It Drive Growth?
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Key Takeaways
Kimco Realty reached 86% of base rent from grocery-anchored assets in Q2 2025, up from 78% in 2020.
KIM recorded 58 straight quarters of positive leasing spreads, underscoring solid pricing power.
S&P and Fitch upgraded KIM's credit rating to A- Stable, citing resilient grocery-anchored cash flows.
Kimco Realty’s (KIM - Free Report) predominant grocery-anchored portfolio lays the foundation for stability and steady income for the company, withstanding uncertain economic scenarios. The retail REIT’s focus on providing essential, necessity-based goods and services to the local communities helps it navigate the rising e-commerce trends.
With seven out of the top 10 tenants being grocers, Kimco was able to achieve its target of 86% annualized base rent (ABR) from its grocery-anchored portfolio in the second quarter of 2025, up from 78% in 2020. With the presence of some of the largest grocers like Kroger, Whole Foods, Albertsons, Publix and Ahold Delhaize in its tenant roster, Kimco's high-quality necessity-based portfolio is likely to witness stable cash flows.
Moreover, since much of the grocery shopping takes place in stores, this leads to high foot traffic in KIM’s retail centers. Also, there is less scope for vacancy, given mostly single-tenant backfills with assigned leases having no downtime or lost rent. Most letters of intent have positive spreads that will help KIM capture revenue upside.
In the second quarter of 2025, Kimco witnessed 58 consecutive quarters of positive leasing spreads, indicating solid pricing power across its high-quality portfolio. As of June 30, 2025, the signed not opened (SNO) pipeline represents $66 million of ABR. The company anticipates approximately 41% of this to commence, with a total of $30 million in rent to be received from the SNO pipeline in 2025.
More so, in mid-September, Kimco received a credit rating upgrade from S&P Global Ratings to ‘A-’ with a Stable Outlook, supported by its stable cash flows from a grocery-anchored portfolio that continues to strengthen its operational performance. The rating was also affirmed by Fitch Ratings the same month.
How Do Regency and Realty Income Focus on Essential Tenants?
Regency Centers (REG - Free Report) focuses its tenant strategy on grocery-anchored, necessity-based, open-air shopping centers. Approximately 85% of Regency Centers’ 480-plus properties are anchored by grocers. This focus delivers stable foot traffic, recurring income and resilience against e-commerce disruption.
Realty Income’s (O - Free Report) major four industries (representing 33.1% of the total portfolio annualized base rent as of June 30, 2025) — grocery stores (10.7%), convenience stores (9.8%), home improvement (6.4%) and dollar stores (6.2%) — sell essential goods and continued to thrive even during the pandemic. A focus on these industries is likely to generate steady rental revenues for the company.
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Kimco Leverages Grocery Demand to Stay Ahead: Will It Drive Growth?
Key Takeaways
Kimco Realty’s (KIM - Free Report) predominant grocery-anchored portfolio lays the foundation for stability and steady income for the company, withstanding uncertain economic scenarios. The retail REIT’s focus on providing essential, necessity-based goods and services to the local communities helps it navigate the rising e-commerce trends.
With seven out of the top 10 tenants being grocers, Kimco was able to achieve its target of 86% annualized base rent (ABR) from its grocery-anchored portfolio in the second quarter of 2025, up from 78% in 2020. With the presence of some of the largest grocers like Kroger, Whole Foods, Albertsons, Publix and Ahold Delhaize in its tenant roster, Kimco's high-quality necessity-based portfolio is likely to witness stable cash flows.
Moreover, since much of the grocery shopping takes place in stores, this leads to high foot traffic in KIM’s retail centers. Also, there is less scope for vacancy, given mostly single-tenant backfills with assigned leases having no downtime or lost rent. Most letters of intent have positive spreads that will help KIM capture revenue upside.
In the second quarter of 2025, Kimco witnessed 58 consecutive quarters of positive leasing spreads, indicating solid pricing power across its high-quality portfolio. As of June 30, 2025, the signed not opened (SNO) pipeline represents $66 million of ABR. The company anticipates approximately 41% of this to commence, with a total of $30 million in rent to be received from the SNO pipeline in 2025.
More so, in mid-September, Kimco received a credit rating upgrade from S&P Global Ratings to ‘A-’ with a Stable Outlook, supported by its stable cash flows from a grocery-anchored portfolio that continues to strengthen its operational performance. The rating was also affirmed by Fitch Ratings the same month.
How Do Regency and Realty Income Focus on Essential Tenants?
Regency Centers (REG - Free Report) focuses its tenant strategy on grocery-anchored, necessity-based, open-air shopping centers. Approximately 85% of Regency Centers’ 480-plus properties are anchored by grocers. This focus delivers stable foot traffic, recurring income and resilience against e-commerce disruption.
Realty Income’s (O - Free Report) major four industries (representing 33.1% of the total portfolio annualized base rent as of June 30, 2025) — grocery stores (10.7%), convenience stores (9.8%), home improvement (6.4%) and dollar stores (6.2%) — sell essential goods and continued to thrive even during the pandemic. A focus on these industries is likely to generate steady rental revenues for the company.