CTO Realty Hits 100% Occupancy at Orlando Hub With New Anchor Lease
An investment-grade national retailer signs a 48,000 sq ft deal, marking a key milestone in the REIT's strategy to fill vacant anchor spaces and boost income.
CTO Realty Growth, Inc. (NYSE: CTO) announced on Monday it has brought its Marketplace at Seminole Towne Center in Orlando, Florida, to 100% leased occupancy after securing a major new anchor tenant.
The real estate investment trust signed a 10-year lease for 48,000 square feet with an unidentified investment-grade national retailer. The deal is a significant step in the company's strategy to revitalize its properties by filling large, vacant anchor boxes, a persistent challenge in the U.S. retail landscape.
Despite the positive operational news, CTO shares traded down approximately 2.4% to $18.07 in Monday's session, against a 52-week range of $14.76 to $19.19. The move comes amid a broader market downturn that may have overshadowed the company-specific catalyst.
The new lease creatively consolidates and repurposes existing space within the 320,000-square-foot center. It comprises the 34,000 square feet formerly occupied by Big Lots, an additional 9,000 square feet of small shop space, and 5,000 square feet of new expansion space, according to the company's press release. The new tenant is expected to open its doors in early 2027.
“We’re excited to welcome a nationally recognized tenant, driving leased occupancy at the Center to 100%,” said John P. Albright, President and CEO of CTO Realty Growth. “We have now resolved seven of the ten vacant anchor spaces that we have been focused on which present a unique mark-to-market releasing opportunity to generate NOI growth.”
Albright noted the company is in negotiations with prospective tenants for its remaining vacancies and remains on track to achieve a significant 40% to 60% positive cash leasing spread across all ten of the original anchor vacancies. This indicates the new leases are being signed at substantially higher rates than previous ones, promising a direct boost to future net operating income.
CTO Realty Growth, which has a market capitalization of approximately $595 million, is a REIT focused on income-producing properties in high-growth markets. For income-focused investors, the company maintains a notable dividend yield of approximately 8.2%.
The announcement is the latest in a series of active portfolio management moves. In recent weeks, CTO announced the acquisition of Pompano Citi Centre, a 509,000-square-foot open-air retail center, and the sale of the Shops at Legacy North for $78 million, using the proceeds to fund the new acquisition in a tax-efficient exchange.
Wall Street holds a cautiously optimistic view of the company. Analysts currently have a consensus "Moderate Buy" rating on the stock, with an average price target of around $20.80, suggesting potential upside from its current trading level. The successful leasing at the Orlando property reinforces the company's operational execution and its ability to enhance the value of its assets in a competitive retail environment.