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Regency Centers Fortifies Balance Sheet, Builds Value

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Regency Centers Corp. produced another year of sector-leading performance. That is according to Hap Stein, chairman and CEO, on the firm’s Q4 earnings call.

“Through the team’s talent and efforts, we executed our proven strategy by proactively and creatively managing our portfolio, building value through development and redevelopment, fortifying our balance sheet, and cost effectively funding new investments,” he said.

Highlights include:

*same-property portfolio was at 96% leased and NOI growth at or above 3.4% for the seventh consecutive year;

*executed on its capital allocation strategy that starts with reinvesting $170 million of free cash flow and modest level of sales of lower-growth assets and nearly $200 million of developments and redevelopments;

*acquisitions with superior growth prospects; and nearly $250 million of share repurchases at an average price of less than $58 per share, all supported by Regency’s blue chip balance sheet.

This year also marked an important milestone with the release of the REIT’s inaugural corporate responsibility report, which showcases its environmental, social and governance initiatives, he explained.

“Growth in core operating earnings, which eliminates certain one-time and non-cash impacts have compounded by 7% over the last three years. This translated into roughly comparable growth in cash available for distribution and, in turn, increases to the dividend by over 5%, both in 2018 and for 2018 at a low payout ratio,” he added.

Retailers continue to clearly demonstrate that physical stores located in top trade areas and thriving centers remain a critical component of a multi-channel strategy, explained Stein on the call. “Even though retailers are being deliberate and cautious with expansion, there’s really good demand for the limited amount of vacant space in our centers and renewal is robust.”