Commercial Real Estate and Simon Property Group and Real Estate & Retail

Simon competitor hoping to raise $750 million in IPO

September 24, 2013

Blackstone Group LP’s Brixmor Property Group Inc., the second-largest U.S. shopping center landlord behind Indianapolis-based Simon Property Group Inc., expects $750 million in gross proceeds in its initial public offering.

The estimate was disclosed Monday in a regulatory filing by New York-based Brixmor. The company, which first filed for an IPO in July, hasn’t set price terms or the number of shares being sold.

An offering of at least $750 million would be the largest IPO by a retail real estate investment trust since Simon raised $840 million in 1993, data from the National Association of REITs show. Blackstone is planning the sale at a time when U.S. shopping-center occupancies are at an almost four-year high and rents are climbing.

Even so, shares of retail-focused REITs have declined in recent months on concern that rising interest rates will increase landlords’ borrowing costs and hurt property values. The Bloomberg REIT Shopping Center index fell almost 15 percent from its May high through last week.

Brixmor owns or operates 522 centers, more than 70 percent of which are anchored by a market-leading grocery store, according to the filing. The company is second to Kimco Realty Corp. among U.S. shopping-center landlords by number of properties.

The assets that form Brixmor’s core were acquired in Blackstone’s $9 billion purchase of U.S. shopping centers from Australia’s Centro Properties Group in 2011.

Brixmor also said in its filing that it is nominating Michael Berman, the chief financial officer of mall owner General Growth Properties Inc., and Anthony Deering, chairman of Exeter Capital LLC, a private investment firm, to its board.
 

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