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WATER COOLER TALK: End Game – Publix Continues Acquisition Activity

JULY 25, 2018 | THE PALOMAR GROUP

With grocery anchored shopping centers continuing to be the darling of retail investment sales, Publix Supermarkets continues their aggressive buying spree of company leased stores and centers. Over the past two years, Publix has been one of the most active and aggressive​ buyers of their shopping centers across the southeast. Today they own somewhere in the neighborhood of 330 stores, around 30% of the total. While competitors including Kroger, Aldi, Southeastern Grocers, and others have also had a history of buying their own stores, they usually did so through heavy leverage. Publix is in the game with all cash. ​

Their continued push towards aggressive ​acquisitions begs the question of what the end game is. As these centers continue to be acquired and taken off the general market, investors and brokers are left wondering what the end game will be. Will they be long term holders of these assets? Will they package them up to sell all together at a later date? Could they be looking to form a new real estate company that will hold all of these assets?​