OAK BROOK, IL—In recent years, many real estate companies have decided to drop their traditional names in favor of ones that are shorter and easier to transform into memorable logos. A similar move was just completed by the Inland Real Estate Corp., which changed its name to IRC Retail Centers Inc. But unlike when Jones Lang LaSalle became JLL, the change by IRC was more than just a name, and addresses challenges that went far beyond branding. The firm was just acquired by funds managed by DRA Advisors LLC, ceased trading on the New York Stock Exchange, and has become a privately-held REIT.
“The true value of our platform and our properties was not appreciated by Wall Street,” Scott Carr, executive vice president, chief investment officer of IRC, tells GlobeSt.com, and company officials have felt that its stock performance did not match what they felt was its true worth. The company operates with a long-term strategy that calls for buying open-air retail centers that need some work to show their true value. The resulting income streams could unnerve New York analysts.
IRC frequently takes retail space offline in order to make improvements that will boost performance over the long-term. “They don't like these short-term disruptions to your income streams,” Dawn Benchelt, assistant vice president, director of investor relations, tells GlobeSt.com. Private ownership, on the other hand, will allow the company to implement its long-term vision without interference.
Furthermore, many Wall Street investors did not truly like where the Oak Brook, IL-based company was buying its assets. “The Wall Street investor has a coastal bias,” Carr says. IRC is the largest owner of open-air retail centers in the Chicago metropolitan area, for example, with about 68% of its assets here. And another 18% are in the Minneapolis metro area. Both markets are, by almost any measure, rather robust, but the Upper Midwest simply did not have a high enough reputation to push up the company's stock price.
“We have a multiyear strategy for growth,” Carr adds, “and that is something DRA recognized sooner than Wall Street.”
Choosing a new name also made sense. The old name “didn't convey our property type or what we did,” says Benchelt. The company's new handle does just that, and by also using IRC, it also provides a link to its past. “We would frequently refer to ourselves as IRC,” says Carr, and that was how the company was listed on the NYSE.
Perhaps the most important aspect of this change, however, is IRC's increased financial power. “DRA invested in our company due to its growth potential,” Carr says, and IRC will in turn have better access to the capital that will fuel growth. The company's structure remains the same, and its objectives to acquire, develop and redevelop retail centers also will not change. “We will pursue these opportunities with a little more nimbleness and at a more robust pace.” In 2015, the company completed $146.2 million in acquisitions, and $61.1 million of sales.
Having greater financial power will be very important in today's marketplace, which has so many investors jumping into the game and intensifying the competition. “We can go after more of these opportunities than we could previously,” says Benchelt. “It's business as usual with a new sense of vitality.”
OAK BROOK, IL—In recent years, many real estate companies have decided to drop their traditional names in favor of ones that are shorter and easier to transform into memorable logos. A similar move was just completed by the Inland Real Estate Corp., which changed its name to IRC Retail Centers Inc. But unlike when
“The true value of our platform and our properties was not appreciated by Wall Street,” Scott Carr, executive vice president, chief investment officer of IRC, tells GlobeSt.com, and company officials have felt that its stock performance did not match what they felt was its true worth. The company operates with a long-term strategy that calls for buying open-air retail centers that need some work to show their true value. The resulting income streams could unnerve
IRC frequently takes retail space offline in order to make improvements that will boost performance over the long-term. “They don't like these short-term disruptions to your income streams,” Dawn Benchelt, assistant vice president, director of investor relations, tells GlobeSt.com. Private ownership, on the other hand, will allow the company to implement its long-term vision without interference.
Furthermore, many Wall Street investors did not truly like where the Oak Brook, IL-based company was buying its assets. “The Wall Street investor has a coastal bias,” Carr says. IRC is the largest owner of open-air retail centers in the Chicago metropolitan area, for example, with about 68% of its assets here. And another 18% are in the Minneapolis metro area. Both markets are, by almost any measure, rather robust, but the Upper Midwest simply did not have a high enough reputation to push up the company's stock price.
“We have a multiyear strategy for growth,” Carr adds, “and that is something DRA recognized sooner than Wall Street.”
Choosing a new name also made sense. The old name “didn't convey our property type or what we did,” says Benchelt. The company's new handle does just that, and by also using IRC, it also provides a link to its past. “We would frequently refer to ourselves as IRC,” says Carr, and that was how the company was listed on the NYSE.
Perhaps the most important aspect of this change, however, is IRC's increased financial power. “DRA invested in our company due to its growth potential,” Carr says, and IRC will in turn have better access to the capital that will fuel growth. The company's structure remains the same, and its objectives to acquire, develop and redevelop retail centers also will not change. “We will pursue these opportunities with a little more nimbleness and at a more robust pace.” In 2015, the company completed $146.2 million in acquisitions, and $61.1 million of sales.
Having greater financial power will be very important in today's marketplace, which has so many investors jumping into the game and intensifying the competition. “We can go after more of these opportunities than we could previously,” says Benchelt. “It's business as usual with a new sense of vitality.”
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