Armada Hoffler sold two retail properties in South Carolina for $82 million, marking a profitable exit strategy.
Quiver AI Summary
Armada Hoffler has successfully sold two retail properties in South Carolina, Nexton Square in Summerville and Market at The Mill Creek in Mount Pleasant, for a total of $82 million. The sales, completed on December 18, 2024, were made to an undisclosed buyer at a blended cap rate in the low 6% range, resulting in a profit spread of over 20% compared to initial development costs. Both properties were fully stabilized and strategically located in growing areas. The transaction allowed the company to repay a high-interest mortgage on Nexton Square and generated nearly $60 million in cash equity for future investments. CEO Shawn Tibbetts expressed satisfaction with the outcome and outlined plans to utilize the proceeds for new acquisitions aligned with their long-term strategy as they move into 2025.
Potential Positives
- Armada Hoffler successfully exited two retail assets for a total of $82 million, achieving a +20% profit spread over costs.
- The sale allowed the company to repay its most expensive mortgage, significantly improving its financial position.
- The transaction generated nearly $60 million in cash equity, which can be redeployed into higher growth opportunities.
- The company plans to utilize the proceeds from the sale to align with its long-term strategy and seek further acquisitions, indicating positive growth prospects.
Potential Negatives
- The sale of the retail assets may indicate a strategic shift away from retail, which could be seen as a reactive measure to market conditions rather than a proactive growth strategy.
- The unspecified buyer's identity raises concerns about the deal's transparency and potential perception in the market.
- The reliance on variable-rate loans for their previous financing could be viewed as risky, particularly in an environment where interest rates may fluctuate significantly.
FAQ
What retail assets did Armada Hoffler sell recently?
Armada Hoffler sold Nexton Square and Market at The Mill Creek in South Carolina.
How much did Armada Hoffler earn from the retail property sales?
The properties were sold for a total of $82 million, representing a +20% profit spread over cost.
What was the exit cap rate for these retail assets?
The blended cap rate for the exit was in the low 6% range.
What will Armada Hoffler do with the proceeds from the sales?
The proceeds will be redeployed into acquisitions aligning with their long-term strategy.
What type of company is Armada Hoffler?
Armada Hoffler is a self-managed real estate investment trust (REIT) with over four decades of experience.
Disclaimer: This is an AI-generated summary of a press release distributed by GlobeNewswire. The model used to summarize this release may make mistakes. See the full release here.
$AHH Insider Trading Activity
$AHH insiders have traded $AHH stock on the open market 12 times in the past 6 months. Of those trades, 11 have been purchases and 1 have been sales.
Here’s a breakdown of recent trading of $AHH stock by insiders over the last 6 months:
- DENNIS H. GARTMAN has traded it 3 times. They made 3 purchases, buying 13,500 shares and 0 sales.
- ERIC E. APPERSON (President of Construction) sold 20,000 shares.
- A RUSSELL KIRK has traded it 2 times. They made 2 purchases, buying 96,136 shares and 0 sales.
- DANIEL A HOFFLER purchased 95,238 shares.
- LOUIS S HADDAD (CEO) purchased 95,238 shares.
- FREDERICK BLAIR WIMBUSH purchased 9,523 shares.
- JAMES C. CHERRY purchased 4,761 shares.
- GEORGE F ALLEN purchased 952 shares.
- JAMES A CARROLL purchased 2,857 shares.
To track insider transactions, check out Quiver Quantitative's insider trading dashboard.
$AHH Hedge Fund Activity
We have seen 129 institutional investors add shares of $AHH stock to their portfolio, and 74 decrease their positions in their most recent quarter.
Here are some of the largest recent moves:
- CITADEL ADVISORS LLC added 1,350,004 shares (+4016.7%) to their portfolio in Q3 2024
- ALYESKA INVESTMENT GROUP, L.P. added 1,100,100 shares (+inf%) to their portfolio in Q3 2024
- VISION CAPITAL CORP added 1,100,000 shares (+inf%) to their portfolio in Q3 2024
- VANGUARD GROUP INC added 1,050,673 shares (+13.8%) to their portfolio in Q3 2024
- UNIPLAN INVESTMENT COUNSEL, INC. added 963,989 shares (+inf%) to their portfolio in Q3 2024
- BALYASNY ASSET MANAGEMENT L.P. added 881,858 shares (+3975.7%) to their portfolio in Q3 2024
- GHISALLO CAPITAL MANAGEMENT LLC added 750,000 shares (+inf%) to their portfolio in Q3 2024
To track hedge funds' stock portfolios, check out Quiver Quantitative's institutional holdings dashboard.
Full Release
VIRGINIA BEACH, Va., Jan. 06, 2025 (GLOBE NEWSWIRE) -- Armada Hoffler (NYSE: AHH) completed a successful exit from two retail real estate assets in South Carolina. The Company closed the sales of Nexton Square in Summerville, South Carolina and Market at The Mill Creek in Mount Pleasant, South Carolina on December 18, 2024.
Both properties were sold to the same undisclosed buyer for $82 million. Armada Hoffler capitalized on the heightened demand for Southeast U.S. retail assets, exiting at a blended cap rate in the low 6% range. Both assets were fully stabilized at the time of the sale.
Armada Hoffler teamed with local sponsors to develop and deliver both Nexton Square and Market at Mill Creek. The $82 million aggregate sales price represents a +20% profit spread over cost, proving out the Company’s initial development thesis.
The transaction enabled Armada Hoffler to repay the Nexton Square mortgage, which was the most expensive variable-rate loan in the portfolio, and harvest nearly $60 million of cash equity for future redeployment into higher growth opportunities.
“We are pleased with the outcome of this disposition as we closed out a productive 2024,” said Shawn Tibbetts, Chief Executive Officer and President of Armada Hoffler. “We plan to redeploy the proceeds into acquisitions that align with our long-term strategy while taking advantage of further arbitrage opportunities and utilizing it as a capital source as we head into the new year.”
Nexton Square is an unanchored 133,608-square-foot open-air lifestyle center in Summerville, South Carolina. Located at the entrance of a 4,500-acre master-planned community, the center serves as the retail gateway to over 10,000 new single-family and multifamily units. Nexton Square opened in 2020.
Market at Mill Creek is anchored by a 50,000-square-foot Lowes Foods grocery store and includes an additional 23,000 square feet of inline shop space. The center opened in early 2018.
About Armada Hoffler
Armada Hoffler is a vertically integrated, self-managed real estate investment trust ("REIT") with over four decades of experience developing, building, acquiring, and managing high-quality, institutional-grade office, retail, and multifamily properties located primarily in the Mid-Atlantic and Southeastern United States. In addition to developing and building properties for its own account, the Company also provides development and general contracting construction services to third-party clients. Founded in 1979 by Daniel A. Hoffler, the Company has elected to be taxed as a REIT for U.S. federal income tax purposes. For more information, visit
ArmadaHoffler.com
.
Forward-Looking Statements
Certain matters within this press release are discussed using forward-looking language as specified in the Private Securities Litigation Reform Act of 1995, and, as such, may involve known and unknown risks, uncertainties and other factors that may cause the actual results or performance to differ from those projected in the forward-looking statement. These statements relate to the prospects of the Company and the appointment of Mr. Tibbetts to the Board of Directors. The forward-looking statements presented herein are based on the Company's current expectations. For a description of factors that may cause the Company’s actual results or performance to differ from its forward-looking statements, please review the information under the heading “Risk Factors” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, and the other documents filed by the Company with the Securities and Exchange Commission from time to time. The Company expressly disclaims any obligation or undertaking to update or revise any forward-looking statement contained herein, to reflect any change in the Company's expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based, except to the extent otherwise required by applicable law.
Contact:
Chelsea Forrest
Armada Hoffler
VP of Corp. Comms. and Investor Relations
Email: cforrest@armadahoffler.com
Phone: (757) 366-4000
This article was originally published on Quiver News, read the full story.
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