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It’s Now Brixmor: Name Change In Store For Centro Shopping Centers

Shopping Center Owner Launches New Identity Highlighting The Role Of Tenants In Its 92 Million-Square-Foot Bricks-And-Mortar Portfolio
September 30, 2011
The former U.S. operations of Australia-based Centro Properties Group has a new name, Brixmor Property Group, a branding identity change that appropriately reflects the company’s renewed emphasis on its huge portfolio of existing bricks-and-mortar shopping centers across the U.S.

CoStar covered the company’s lengthy and well-documented battle to deleverage, culminating in the completion of the acquisition three months ago by an affiliate of Blackstone Real Estate Partners VI L.P. of its 585 properties and operating platform for about $9 billion. This week, under decidedly more favorable circumstances, CoStar caught up with Brixmor Chief Executive Officer Michael Carroll, who said the company has a new outlook and fresh perspective to go with the new identity.

Brixmor this week also unveiled a new logo and a re-branded web site at Further branding initiatives, including property signage and new leasing and marketing materials, will be deployed over the next several months. The company’s subsidiaries Centro NP LLC and Centro NP Residual Holding LLC will be changing their names to Brixmor LLC and Brixmor Residual Holding LLC, respectively.

"We’re back, and very focused on driving this business, on value creation, and on engaging with our tenants," Carroll tells CoStar. "We’re a well-capitalized company now and we have the ability to put that capital to work -- reinvesting back into our assets, reinvesting back into our people and infrastructure and growing the business again, which is something that hasn’t happened over the past four years."

Brixmor is the nation’s second-largest owner of community and neighborhood shopping centers at 92 million square feet of leasable space. It has portfolio occupancy of about 88%, providing a multitude of leasing, tenant repositioning and redevelopment opportunities within its portfolio to drive growth, Carroll said.

"We wanted a name that communicated that we are focused on our business and our shopping centers, our retail tenants and customers," said Carroll, who noted that after vetting numerous potential names, the company decided on Brixmor to convey the simple concept of the company’s strong bricks-and-mortar presence and its value as a growth channel for tenants who are expanding or repositioning their physical space.

"We cover that channel phenomenally, across 39 states and almost 200 different markets," Carroll said. "We can sit down and talk to them about property across the entire geography of the country, not just a region or location, and be a utility for them as they look to expand their businesses across the country."

Specifically, Brixmor is active with all retailers that are pursuing new prototype stores and concepts, such as Kroger Co., Kohl’s, Dick’s Sporting Goods and Wal-Mart, he explained.

"We have the capital available to support trying to reposition retailers to their most current prototypes. That’s really what drives the redevelopment and repositioning part of our business -- staying current with our anchors. In a robust market they’re dynamic and getting larger, and in a market like we’re in now, they’re trying to do things more efficiently with less space."

While the company has no plans at present to acquire additional property, Carroll said Blackstone Group L.P.’s recent acquisition of 36 shopping centers from Equity One Inc. for $473.1 million demonstrates Brixmor's potential access to private-equity capital to fund opportunity acquisitions should they arise.

“We’re going to be opportunistic and look at things out there, but our focus is going to be on the existing portfolio first and foremost.”

Carroll noted that the industry has been through an unprecedented time of difficulty in the retail space with bankruptcies and sales contractions.

"But what’s come out of it is we feel our stable of tenants is stronger than it’s ever been. We see strength in our top 50 tenants list, and they’ve been very smart, strengthening their balance sheets, running more efficiently and managing inventory much better. If some retailers are selling less than they were four years ago, they’re selling it more profitably -- that’s consistent from what we hear from our retailers -- that they do have healthier margins in this current environment."

Lack of new supply will also benefit Brixmor as its large portfolio provides opportunities for key retailers such as TJX and Kroger Co. to move into existing or repositioned space rather than brand-new stores.

"As a large portfolio owner, it’s a big benefit now because you can work with retailers who don’t have other options for new construction," he said. "Supply and demand is working in our favor."
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