COVID Retail Computing Offers Agree Realty Big Opportunity and Growth
At the start of the COVID-19 pandemic, a Bloomfield Hills-based real estate investment trust felt poised to capitalize on the upheaval the global health crisis had brought to commercial real estate.
It turns out that Agree Realty Corp. (NYSE: ADC) was right.
The company, led by chairman and chief executive Joey Agree, has more than doubled the size of its portfolio and outgrown a headquarters it expanded less than three years ago, announcing last week that it would redevelop the former Art Van Furniture Inc. store in its new 50,000 square foot base of operations.
Focusing on commercial properties leased to quality tenants, Agree Realty has spent the past decade plus reinventing itself with the second generation of the Agree family at the helm.
The company has done this by quickly repurchasing properties with a diverse mix of tenants who have strength in all facets of the retail game, in stores, online and in spaces in between.
“COVID-19 has reaffirmed our belief that the strongest retailers with the strongest balance sheets are going to get even stronger,” Agree said in an interview. “Their omnichannel, including online shopping, in-store pickup, click-and-collect, and fulfillment initiatives, have helped provide consumers with essential goods and services during the days of lockdown. Now that we let’s get out of this pandemic, hopefully sooner rather than later, retailers are now truly focused on omnichannel fulfillment.”
The company’s portfolio of properties has grown to 1,404 in 47 states totaling just over 29 million square feet, from the 660 properties and 11.5 million square feet it had less than three years ago and of the 860 properties and 16.3 million square feet it had less than two years ago.
Growth is expected to continue in 2022, as the company’s current estimate is for acquisition volume of $1.1 billion to $1.3 billion, although these estimates may change during the year.
The company will announce its fourth quarter and full year 2021 financial statements on February 22
Its main funds from operations for the third quarter were $64 million, up 44% from $44.5 million in the third quarter of 2020, the company announced in November. For the first three quarters of 2021, base FFO was $175.9 million, up 43.2% from $122.9 million in the same period of 2020.
Although it now has an enterprise value of approximately $6.7 billion and is in growth mode, the company struggled more than a decade ago as its revenue was tied to fate. of certain tenants finally condemned.