Kimco Realty (KIM) investor relations material

Industry and market dynamics

• Shopping center sector benefits from historically low new supply, with only 0.2% of stock under construction, supporting high occupancy and rent growth.

• Rents in many markets must rise 30%-60% to justify new development, limiting new supply and enhancing pricing power.

• Retailer demand for space is robust across categories, with aggressive expansion plans and competition for available space.

• Omni-channel retail strategies, combining e-commerce and physical stores, are driving higher sales and supporting rent increases.

• Essential goods and services, especially grocery-anchored centers, provide defensiveness and stable consumer demand.

Growth strategy and portfolio management

• Focus on first-ring suburbs in major metro markets, targeting affluent customers and essential retail.

• Mark-to-market rent opportunities remain significant, especially for anchor spaces, supporting future rent growth.

• Small shop occupancy lift is identified as the next growth driver, with service-based tenants leading new leasing activity.

• Structured investment program and capital recycling enhance growth by redeploying capital from low-growth ground leases to higher-yielding multi-tenant centers.

• Recent M&A activity, such as the RPT acquisition, has closed occupancy gaps and added grocery anchors, boosting leasing momentum.

Financial position and capital allocation

• Maintains strong balance sheet with A-/A3 ratings and net debt to EBITDA at 5.2x consolidated.

• Capital allocation priorities include share buybacks, high-yield redevelopment projects, and managing debt maturities with diverse funding options.

• Redevelopment yields run 10%-12%, and $77 million in signed but not open leases will drive future earnings.

• Structured investments in preferred equity and mezzanine financing provide attractive yields and acquisition opportunities.

• Generates $160 million in free cash flow after all expenses and dividends, supporting reinvestment.