Beachwood, Ohio — SITE Centers Corp. (NYSE: SITC), a Beachwood-based owner of open-air shopping centers in suburban communities, has approved a plan to spin off its convenience retail assets into a separate publicly traded REIT to be named Curbline Properties Corp. (CURB). According to SITE Centers, the spin-off creates the first and only public REIT exclusively focused on convenience assets, which generally consist of a row of unanchored shops that are positioned on the curb line of well-trafficked intersections. The tenants within these centers cater to daily convenience trips. Examples include Starbucks Coffee, Darden, JPMorgan Chase, Verizon and Chipotle.
“The convenience sector offers attractive, inflation-protected returns driven by high renewal and retention rates and limited operating capital expenditures,” states SITE Centers.
There are more than 68,000 unanchored assets in the U.S., according to ICSC, with over $40 billion of assets traded between 2018 and 2022.
The median asset size of the CURB portfolio as of Sept. 30 was 20,000 square feet, with 91 percent of base rent generated by units less than 10,000 square feet. Since launching its convenience strategy in 2019, the company has amassed a portfolio of 61 wholly owned properties. As of Sept. 30, the CURB portfolio was 96.2 percent leased.
In 2022, SITE Centers began the process of separating certain convenience properties that are adjacent to existing assets, with the separation work expected to be completed prior to the planned spin-off of CURB.
SITE Centers is expected to provide certain shared services to CURB for up to 24 months following the transaction. Following the separation of CURB, the company may opportunistically sell additional assets to repay debt, redeem CURB’s preferred investment and return capital to shareholders.
CURB expects to confidentially submit its initial draft Form 10 registration statement with the U.S. Securities and Exchange Commission in 2024, and the spin-off is expected to be completed in the second half of 2024.