Spirit Realty Plans Spinoff to Remove Shopko Exposure

The spinoff will “remove and isolate certain structural impediments that have been present” since Spirit Realty’s 2012 IPO, Hsieh said Thursday.

DALLAS—Spirit Realty Capital (SRC) said late Thursday afternoon it planned to spin off substantially all of its properties leased to Shopko Stores into a separate publicly traded REIT. Known for the moment as SpinCo, the spinoff REIT is expected to have $2.7 billion in gross real estate investments.

Among the primary objectives of the spinoff, which also will encompass assets that collateralize SRC’s Master Trust 2014, is to enable SRC and SpinCo to pursue two separate investment strategies. At present, the SRC platform encompasses investment grade tenants on the one hand and small- and medium-sized tenants on the other, SRC’s president and CEO, Jackson Hsieh, said on a conference call Thursday evening.