Shopping center REIT, Kimco Realty Corporation (NYSE:KIM), has acquired an 85% interest in the 21 retail properties held under PL Retail Portfolio, its joint venture fund with DRA Advisors. The $175 million acquisition brings Kimco's ownership in the portfolio to 100%.

Kimco said the purchase price was based on an "enterprise price" of $825 million, which is comprised of $805 million for existing assets and $20 million for development rights at Pentagon Centre mall in Arlington, VA. Included in this total is Kimco's assumption of $564 in non-recourse mortgage debt and $50 million of perpetual preferred stock. Kimco funded the acquisition with its existing credit facility. The capitalization rate was 7.6%, based on NOI of approximately $61 million annually.

The portfolio, which Kimco's chairman and CEO Milton Cooper describes as "high quality assets in strong markets" is currently 94% leased. The 21 shopping centers comprise approximately 5.2 million square feet of gross leasable area (GLA) and are located in California (8 assets; 27% of GLA), Florida (6 assets; 42% of GLA), Phoenix metro (2 assets; 7.3% of GLA), metro NJ (2), Long Island (1), metro Washington DC (1) and Greenville, SC (1). Costco represents more than 10% of the portfolio's total GLA (Kimco is Costco's largest landlord) and Home Depot, Ross, the TJX stores, Wal-Mart, Lowe’s, PetSmart, BJ’s Wholesale and Best Buy together constitute an additional 25% of GLA.

This transaction closed days after Equity One closed on its $103.7 million acquisition of Westbury Plaza, which was part of the Kimco/DRA fund. For more on that deal, click here.

PL Retail LLC was formed in December 2004 when the joint venture between Kimco and clients of DRA completed the $1.2 billion acquisition of Price Legacy Corp, taking on ownership of 33 neighborhood and community shopping centers totaling 7.7 million square feet.

This article appears in CoStar's Retail News Roundup: Nov. 8 - 14, 2009
This week in the Retail Roundup, CoStar reports on expansions or new concepts at Sports Fan Attic and Bajio Mexican Grill; closings, cutbacks, defaults, or bankruptcy news at Waldenbooks; acquisition, merger, loan, sale, or IPO activity at Crown Acquisitions, Goldman Properties and The Feil Organization, Blackstone and Glimcher, Coventry and DDR, Equity One, Kimco and DRA Advisors, KKR and Dollar General, Iconix and Ecko, and Landry's Restaurants; new retail development news in MD; personnel or corporate announcements at Wal-Mart and ICSC, and Developers Diversified; sustainability and green building news at Food Lion; and more.