BEACHWOOD, Ohio, May 29, 2014 /PRNewswire/ -- DDR Corp. (NYSE: DDR) today announced the commencement of a multi-year proactive lease termination initiative aimed at recapturing high-quality anchor store locations across its portfolio. Through this initiative, DDR is collaborating with retailers in the books, electronics, toys, office and traditional department store categories to right-size their real estate footprints by regaining control of locations in advance of natural lease expiration, where the Company can remerchandise its prime assets with market-share-winning tenants while realizing mark-to-market rental upside of 30-40%.
During the first phase of this initiative, DDR has identified 90 anchor locations, representing 3.3 million square feet of prime retail space that meet the Company's criteria for accretive recapture. Of these leases, DDR has finalized terms to recapture 21 locations, representing 550,000 square feet primarily located in Boston, Cleveland, Denver, Orlando, Phoenix, Raleigh and San Antonio.
"This initiative demonstrates our ability to create organic growth opportunities for our best-in-class retail partners regardless of current portfolio leased rate," said Paul Freddo, senior executive vice president of leasing and development for DDR. "Recapturing below-market leases represents an incremental growth opportunity to upgrade asset-level merchandise mix and NOI growth profiles, while simultaneously expanding redevelopment opportunities that will further enhance the quality of our portfolio."
Demand for new store growth from retailers such as Nordstrom Rack, Sprouts Farmers Market, Ulta, Whole Foods, Five Below, HomeGoods, Fresh Market, Marshalls, Trader Joe's, White House Black Market, Gap Factory, Shoe Carnival, PetSmart and Carter's represent a select group of merchants that DDR is in discussions with to backfill the recaptured locations. While 2014 will represent the initial period of acquisition, due to typical retailer black-out periods, the benefits of the remerchandising and mark-to-market opportunities will commence the second half of 2015.
About DDR Corp. DDR is an owner and manager of 396 value-oriented shopping centers representing 108 million square feet in 39 states and Puerto Rico. The Company's assets are concentrated in high barrier-to-entry markets with stable populations and high growth potential and its portfolio is actively managed to create long-term shareholder value. DDR is a self-administered and self-managed REIT operating as a fully integrated real estate company, and is publicly traded on the New York Stock Exchange under the ticker symbol DDR. Additional information about the Company is available at www.ddr.com, as well as on Twitter, LinkedIn and Facebook.
Safe Harbor DDR Corp. considers portions of the information in this press release to be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, both as amended, with respect to the Company's expectation for future periods. Although the Company believes that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, it can give no assurance that its expectations will be achieved. For this purpose, any statements contained herein that are not historical fact may be deemed to be forward-looking statements. There are a number of important factors that could cause our results to differ materially from those indicated by such forward-looking statements, including, among other factors, local conditions such as supply of space or a reduction in demand for real estate in the area; competition from other available space; dependence on rental income from real property; the loss of, significant downsizing of or bankruptcy of a major tenant; constructing properties or expansions that produce a desired yield on investment; our ability to buy or sell assets on commercially reasonable terms; our ability to complete acquisitions or dispositions of assets under contract; our ability to secure equity or debt financing on commercially acceptable terms or at all; our ability to enter into definitive agreements with regard to our financing and joint venture arrangements or our failure to satisfy conditions to the completion of these arrangements; and the success of our capital recycling strategy. For additional factors that could cause the results of the Company to differ materially from those indicated in the forward-looking statements, please refer to the Company's Form 10-K for the year ended December 31, 2013, as amended. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.