US real estate investment trust (REIT) CTO Realty Growth has added a $68.7m (€63.2m) shopping centre in Florida to its portfolio.
The NYSE-listed REIT has acquired Marketplace at Seminole Towne Center, a 318,000sqft multi-tenant retail power centre in the Sanford submarket of Orlando.
Seminole Towne Center, situated on 41 acres, is 98% occupied.
CTO Realty said it acquired the property through a ”1031 like-kind exchange” using $24.1m of restricted cash generated from the company’s previously completed property dispositions, as well as available cash and draws from the company’s unsecured revolving credit facility. A portion of the acquisition was structured as a reverse like-kind exchange in anticipation of possible future income property dispositions by the company.
A 1031 exchange, also known as a like-kind exchange, is a tax strategy used in real estate investing. It allows you to defer paying capital gains tax on the sale of a qualified investment property by reinvesting the proceeds into another qualified property.
John P Albright, president and CEO of CTO Realty Growth, said “We are pleased to announce the acquisition of Marketplace at Seminole Towne Center, a premier retail destination near our headquarters in Orlando, Florida.”
Albright said the asset provides a “stable income stream and growth potential, and due to its prime location and strong community ties, we see attractive potential upside from below-market rents”.
“We believe we acquired the property below replacement cost and this acquisition aligns with our commitment to expanding our footprint in high-quality, dynamic markets and underscores our dedication to delivering long-term value to our shareholders,” Albright added.
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