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WINTER PARK, Fla. - CTO Realty Growth, Inc. (NYSE: CTO), a real estate investment trust (REIT) focused on open-air shopping centers in the U.S. Southeast and Southwest, has announced substantial investment and financing activities in the third quarter of 2024. The company's investment activities for the year reached $273.8 million, surpassing its earlier projections for 2024.
During the third quarter, CTO Realty Growth engaged in investment transactions totaling $191.3 million, culminating in a year-to-date investment sum of nearly $274 million at a weighted average yield of 9.1%. The company will update its investment guidance when it reports full third-quarter results on October 24, 2024.
CTO Realty Growth also issued a $43.8 million first mortgage loan secured by a substantial mixed-use development project in Herndon, Virginia. This loan bears an 11% initial fixed interest rate and includes a 1.25% origination fee. It is secured by over 100 acres entitled for a development adjacent to Dulles International Airport and a Metrorail Silver Line station.
On the financing side, the company raised approximately $126 million through its At-The-Market (ATM) equity program by issuing about 6.9 million shares at an average price of $18.63. Additionally, on the last day of the third quarter, CTO Realty Growth closed a $100 million unsecured term loan with an initial effective fixed interest rate of 4.7% after applying existing SOFR swap agreements.
President and CEO John P. Albright commented on the company's strong performance, noting the efficient capital raising and the strengthened balance sheet, which positions the company for further growth.
As of the end of the quarter, CTO Realty Growth had roughly $200 million available under its revolving credit facility and had 29,971,538 shares of common stock outstanding.
This business update, based on a press release statement, underscores CTO Realty Growth's active investment and financing strategies and suggests a robust position within the market, with a focus on future expansion.
In other recent news, CTO Realty Growth has been the subject of multiple developments. B.Riley Financial has raised its price target for CTO Realty from $19.50 to $22.50, maintaining a Buy rating. The firm cites CTO Realty's strong investment activity in the third quarter of 2024 and expects near-term growth. Notably, CTO Realty's recent investments, including the acquisition of a portfolio of shopping centers, were highlighted for their high capitalization rate.
Additionally, CTO Realty launched a $24.5 million preferred stock offering. The company plans to sell shares of its 6.37% Series A Cumulative Redeemable Preferred Stock, aiming to raise gross proceeds up to this amount. As part of this offering, the shares will be sold through sales agents including BMO Capital Markets Corp. and B. Riley Securities, Inc.
In terms of earnings, CTO Realty concluded the second quarter of 2024 with a healthy physical occupancy rate of 92.6%. The company signed new leases, renewals, and extensions totaling 79,000 square feet at an average rate of $25.87 per square foot. As a result, CTO Realty has revised its investment outlook for 2024 to between $200 million and $250 million and increased its core FFO guidance by 12% and AFFO by 11%.
InvestingPro Insights
CTO Realty Growth's recent investment and financing activities align with several key metrics and insights from InvestingPro. The company's market capitalization stands at $440.21 million, reflecting its substantial presence in the REIT sector.
One of the most notable InvestingPro Tips is that CTO pays a significant dividend to shareholders, with a current dividend yield of 8.0%. This aligns with the company's focus on providing value to investors, as evidenced by its recent capital raising activities through the ATM equity program.
Another relevant InvestingPro Tip highlights that CTO has maintained dividend payments for 49 consecutive years. This impressive track record underscores the company's commitment to shareholder returns, which is particularly noteworthy given its recent expansion and investment activities.
The company's revenue growth of 19.62% over the last twelve months and quarterly growth of 10.74% in Q2 2024 reflect its successful investment strategy, as mentioned in the article. Additionally, CTO's strong EBITDA growth of 27.49% over the last twelve months supports its robust financial performance.
It's worth noting that CTO is trading at a Price to Book ratio of 0.9, suggesting that the stock may be undervalued relative to its assets. This could be of interest to investors considering the company's recent expansion and financing activities.
InvestingPro offers 9 additional tips for CTO Realty Growth, providing a more comprehensive analysis for investors interested in delving deeper into the company's financial health and market position.
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