Inland Exploring Sale Of $1.4B Shopping Center REIT

Inland Real Estate Income Trust, a nontraded real estate investment trust that owns more than 7M SF of U.S. shopping centers, is evaluating its next steps, which could result in a sale.

Inland REIT-ownerd Rusty Leaf Plaza in Orange, California
Inland Reit-Owned Rusty Leaf Plaza In Orange, California

Inland REIT has a portfolio of 52 shopping centers across 24 states worth approximately $1.4B. As part of the strategic review, announced last week in a regulatory filing, Inland said it will work with a financial adviser to determine next steps, which could be a complete sale, a public stock listing or no action at all.

During the review, Inland has suspended its distribution reinvestment plan and stock buyback program.

The fund's parent company has undergone much change in the past year that has impacted its leadership.

In January, Inland Chairman Daniel Goodwin, who co-founded the business that grew into the Inland Real Estate Group of Cos., died. Later that month, Inland announced its president and CEO, Mitchell Sabshon, would retire. As a result, Inland has had to make changes across its board and executive team.

Inland REIT mainly operates grocery-anchored centers, a sector of retail that has boomed since the start of the pandemic. New unconventional tenants like Sephora have been drawn to the foot traffic that grocery stores produce.

Low vacancy rates have also allowed shopping center owners to quickly backfill spaces. That has been a savior for landlords with bankrupt or consolidating anchor tenants, as the owners have replaced the exiting renters with better tenants, improving their centers and minimizing the exodus of other occupiers.

In its statement, Inland said it is executing a plan to lower exposure to big-box retailers in its portfolio.

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