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Regency Centers Withdraws 2020 Guidance on Coronavirus Scare

Zacks Equity Research

The coronavirus outbreak has been wreaking havoc on the global economy for the past couple of months, the retail REIT sector being no exception. In regard to that, Regency Centers Corporation REG recently informed its stakeholders about the actions being taken to counter this volatile situation.

Like other retail REIT counterparts, including The Macerich Company MAC and SITE Centers Corp SITC, Regency Centers has withdrawn its full-year 2020 guidance issued on Feb 12, 2020. The company had projected 2020 NAREIT Funds From Operations per share to be in the range of $3.90 to $3.93. This was backed by same-property NOI growth, excluding termination fees of 0% or more.

Along with this, Regency Centers apprised of its liquidity position and the measures undertaken to enhance the same in these uncertain times. The company settled its forward equity offering from September 2019 at $67.99 per share and garnered proceeds of about $125 million.

Further, the company made use of its revolving credit facility of $1.25 billion, by drawing down $500 million from it. This provided Regency Centers with a combined cash balance of about $720 million and an additional amount of $545 million available from the revolving credit facility. Thus, the total liquidity of the company stands at about $1.27 billion.

Additionally, the company has no unsecured debt maturities until 2022. Nonetheless, the company has $153 million and $174 million of secured mortgage debt maturing in 2020 and 2021, respectively.

While providing updated related to its investment activity, Regency Centers noted that it has about $350 million of development and redevelopment projects at various stages of completion, of which $225 million would be required to complete those projects that are in process.

Moreover, construction in certain projects have been either slowed down or suspended due to municipal orders, health concerns and/or labour limitations. At the end of 2019, the company had 22 properties in development or redevelopment. In addition, in-process development and redevelopment projects were 90% leased, projected to yield an average return of 7.3%.

The company plans to provide updates on these and 2020 guidance, along with first-quarter 2020 results.

Shares of Regency Centers, currently carrying a Zacks Rank #3 (Hold), have depreciated 36.7% so far this year, while its industry has declined 35.7%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.



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