DALLAS, Oct. 8, 2015 (GLOBE NEWSWIRE) — Stonegate Capital Partners initiates research coverage on Armada Hoffler (NYSE:AHH).
Armada Hoffler Properties, Inc. (NYSE:AHH), was originally founded in 1979 and today still operates as a full service real estate company. AHH develops, constructs, owns and manages high quality, institutional grade office, retail and multi-family properties throughout the Mid-Atlantic and Southeastern regions. The company is incorporated in Maryland and operates as a real estate investment trust (REIT) for tax purposes. AHH is headquartered in Virginia Beach, VA, where its flagship property Town Center is also located.
Armada Hoffler appears capable of delivering sustainable, low-risk growth to investors through its diversified real estate portfolio, which includes a healthy development pipeline.
- AHH has dependable cash flow created by occupancy in excess of 95%
- The Company has developed approximately $1.6 billion in assets to date and had two major projects underway as of 6/30/15, one of which includes a partnership with Johns Hopkins in Baltimore, MD
- With its internal team of developers, AHH can manage costs and timing on project, creating immediate equity when taking properties online at an estimated spread of 150 – 200 bps; this factor not only gives the company several advantages in the marketplace but also significantly differentiates AHH from other publicly traded REITS operating as pure-play acquirers of income-producing properties
- Management has closed on approximately $115 million in strategic acquisitions since its IPO, adding 6 properties that were immediately accretive to its portfolio.
- Its construction business (operated through a taxable REIT subsidiary) gross profit was $4.6M in 2014 and could approach $6M in 2015; AHH had approximately $195.5 million in its construction backlog as of 6/30/15
- The Company constantly re-evaluates its properties and disposes of non-core assets when identified so that capital can be redeployed; the recent sale of Whetstone Apartments yielded AHH in excess of 20% profit; just prior to that, sales of Sentara Williamsburg and Virginia Natural Gas yielded cap rates of 6.3% and 6.25%, respectively
- The current dividend yield is 6.7%, with the most recently report dividend of $0.17 in Q215
- Armada Hoffler has a long-standing management team that together owns approximately 24% of outstanding common shares and OP units
- The Company is well-positioned within the real estate industry with very favorable growth dynamics for its retail, office and multifamily designs and locations
- To date, AHH has formed over 20 public/private relationships as part of its development efforts, which add considerable barriers to entry for competitors
We believe that Armada Hoffler offers a well-diversified real estate investment opportunity for the marketplace, with a current share price trading approximately 27% below our median estimated Net Asset Value (NAV) per share.
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About Stonegate Capital Partners
Stonegate Capital Partners is a Dallas-based corporate advisory firm dedicated to serving the specialized needs of small-cap public companies. Since our inception, our mission has been to find innovative, undervalued public companies for our network of leading institutional investors who seek high quality investment opportunities.
CONTACT: Stonegate Capital Partners 214-987-4121