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NEW HYDE PARK, NY-With transactions at a near standstill, Kimco Realty Corp. is returning its focus to its core business—neighborhood and community centers, executives said at the company’s third quarter conference call.

The company has reduced its planned transaction income, which had totaled almost $675 million over the last five years, to nearly zero for the fourth quarter because of the lack of credit available to buyers. While Kimco is “uniquely positioned” to acquire and manage large portfolios for institutional investors, many potential acquirers are sitting on the sidelines waiting for the capital markets to stabilize, said David Henry, vice chairman and chief investment officer.

“The real estate markets have changed, and continue to change dramatically,” Henry said. “From a new business perspective, we have responded by adopting a more focused strategy across our operating business. We plan on concentrating on retail properties that will align us with our core experience.”

KDI, its fee merchant building division, has been merged into Kimco’s redevelopment staff. Only two KDI development projects were approved and closed in 2007, and one this year. In addition, Kimco will limit its investment activity to retail investment and remains committed to Canada and Mexico. Henry noted that retailers such as Wal-Mart and Costco, which have slowed expansion in the US, are continuing to grow in Mexico.

The company’s US centers benefit from locations close to major cities, and a tenant mix that consists of necessity retailers, said David Lukes, executive vice president. Lease turnover is higher than last year, though new leases also are at an all time high, he said.

Net income available to common shareholders was $96.8 million for the third quarter, up from $75.1 million in the same period last year. Funds from operations (FFO) were $176.9 million, up from $146.6 million in the year-ago period. Occupancy was 95.4%.

As of Sept. 30, Kimco owned interests in 1,945 properties comprising 182 million square feet of leasable space across 45 states, Puerto Rico, Canada, Mexico, Chile, Brazil and Peru.

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