In a letter sent to stockholders, Retail Properties of America Inc. (RPAI) laid out its plans to become an independent investment entity and continue moving away from its roots as a subsidiary of Oak Brook, IL-based Inland Group.
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Up until a few months ago when it was still known as Inland Western Retail Real Estate Trust Inc., Retail Properties of America informed shareholders of its strategic plan to grow the value of its asset portfolio, streamline its operating platform and strengthen its balance sheet.
"We are writing to provide an update on the significant progress we have made to improve our portfolio, lower our risk profile, manage our costs and position RPAI for long-term value creation," the letter read.
"RPAI continues to control costs and focus on corporate overhead. As part of this effort, we have worked hard to establish RPAI's independence from its previous sponsor, The Inland Group. We have undertaken a thorough review of our service agreements with Inland and its affiliates and we decided to terminate a majority of these arrangements."
"These actions include moving into new office space
apart from the Inland campus in the fourth quarter of 2012, resulting in a less expensive lease than our current lease. In addition, with a fully staffed team that can accommodate the influx of work and operations that we foresee in the future, RPAI can reduce the overhead associated with corporate marketing and capital markets activities."
In its second quarter, RPAI signed 148 new and renewal leases and increased its retail occupancy rate to 88.1%, an increase of 180 basis points year over year and 10 basis points sequentially.
In addition, retail portfolio percent leased was 91%, up 230 basis points year-over-year, and 40 basis points sequentially, and we identified over 800,000 square feet of potential transactions in our robust leasing pipeline.
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