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Wheeler REIT buys $71M 14-property portfolio, updates FY AFFO outlook

Wheeler Real EstateInvestment Trust Inc. has acquired a portfolio of 14 grocery-anchoredproperties in South Carolina and Georgia for roughly $71.0 million.

The company said the transaction marks its largest acquisitionto date. It funded the transaction using cash; about $60.4 million from its estimated$67.2 million revolving credit line with KeyBank NA, which was expanded from as of April 12; an $8.0million term loan secured with Revere High Yield Fund LP; and the issuance of 888,889partnership units of its operating partnership with a per-unit value of $2.25, accordingto an April 12 release.

The portfolio comprises 603,142 gross leasable square feet, witha 92% combined occupancy. The properties are anchored by grocery stores such asHarris Teeter, Bi-Lo and Piggly-Wiggly.

Wheeler REIT said the transaction brings its total gross leasablearea to about 3.8 million square feet, encompassing 56 retail assets. That addsto its 81-acre development property portfolio, which includes nine undeveloped landparcels and one redevelopment asset.

As a result of the acquisition, Wheeler REIT updated its annualizedAFFO guidance to a range of 16 cents to 17 cents per share, compared to previousexpectations for AFFO to range between 11 cents and 12 cents per share.

The AFFO guidance assumes flat occupancy rates, renewal spreadsand interest rates, as well as no further purchases or capital raises during thequarter. It excludes an estimated 2 cents per share in expected earnings duringthe 2016 second half, on an annualized basis, from identified third-party developmentand leasing fees.