Kimco Realty Buys Two Louisville Grocery-Anchored Centers for $295 Million at 6% Cap Rate

Kimco Realty Corp. (NYSE: KIM), one of the largest U.S. owners of open-air shopping centers, said late Monday, Nov. 2, 2026, that it has acquired two grocery-anchored retail properties in Louisville, Kentucky, for $295 million. The purchase of Paddock Shops and Shelbyville Road Plaza gives the real estate investment trust three grocery-anchored centers in the Louisville market, according to the company's announcement, which was released at 5:48 p.m. ET.

What Kimco bought

The two centers sit in Louisville's East End and together cover more than 741,000 square feet. They are anchored by Trader Joe's and The Fresh Market, and Kimco said each property draws more than 4 million visits a year, citing foot-traffic data from Placer.ai.

Paddock Shops is a 351,000-square-foot lifestyle center in the northeastern part of the city and was 94% leased at the time of the deal. Kimco said the center's shoppers have a median household income of about $122,000, close to double the Kentucky statewide figure, and that roughly 60% hold at least a bachelor's degree, again citing Placer.ai. The property will be added to Kimco's Lifestyle Collection, the company's group of signature open-air and mixed-use centers.

Shelbyville Road Plaza is a 390,000-square-foot center in St. Matthews, an established retail hub in the Louisville metro area, and was 92% leased. National tenants across the two sites include REI, Total Wine and More, Pottery Barn, West Elm, Ulta Beauty, Nordstrom Rack, Burlington, Ross Dress for Less and Old Navy.

Kimco already owned Festival at Jefferson Court, a Kroger-anchored center in the same metro area. With the new purchases, the company's Louisville holdings total 911,000 square feet across three grocery-anchored properties.

Pricing and funding

Kimco said it paid a blended going-in capitalization rate of about 6% for the two centers. That is more than 100 basis points above the roughly 5% average cap rate on the properties it has sold so far in 2026, a gap the company described as recycling capital into higher-yielding assets. A cap rate measures a property's first-year net operating income as a percentage of its purchase price.

The company said net operating income at the centers is underwritten to grow about 4% a year over the next decade, based on below-market rents on a number of existing leases and room to change the tenant mix. The deal was funded mainly with proceeds from 2026 property sales structured as Section 1031 exchanges, which allow real estate sellers to defer capital gains taxes by reinvesting in similar property, and Kimco described the purchase as self-funded and leverage-neutral.

Kimco also cited market data from Cushman and Wakefield showing Louisville shopping center vacancy at 3.9%, compared with 6% nationally. According to that data, the metro ranks among the top 10 major U.S. markets for occupancy and has no new shopping center space under construction.

"We sold lower-growth assets and reinvested the proceeds into higher-growth opportunities that strengthen our presence in a market we find very attractive," Chief Executive Officer Conor Flynn said in the statement. President and Chief Investment Officer Ross Cooper said the company plans to use its leasing platform to raise occupancy and rents at both properties.

Context from third-quarter results

The acquisition follows Kimco's third-quarter 2026 report on Oct. 29, in which the REIT posted funds from operations, a standard REIT earnings measure, of $0.47 per diluted share, up 6.8% from $0.44 a year earlier. Net income available to common shareholders rose to $272.5 million, or $0.41 per diluted share, from $130.2 million, or $0.19, mainly because of larger gains on property sales.

Portfolio occupancy reached a record 96.6% at the end of September, and same-property net operating income grew 4.9% from a year earlier. Rent spreads on comparable new leases were 31.5%. During the quarter, Kimco sold The Witmer, a 440-unit apartment building at its Pentagon Centre property in Virginia, for $211.5 million at a cap rate of about 5.1%, and completed the previously announced sale of four Costco-anchored assets for about $127 million. It also bought two Florida centers, Pompano Marketplace for $53 million and Sunshine Plaza for $56 million.

Kimco raised its full-year 2026 guidance for funds from operations to $1.84 to $1.86 per diluted share, from $1.83 to $1.84, and lifted its net income outlook to $1.07 to $1.09 per share. The company's updated assumptions call for acquisitions and dispositions to be roughly balanced for the year, with total transaction volume of $400 million to $500 million, acquisitions at a weighted average cap rate near 6.0% and dispositions near 5.0%.

The board declared a quarterly dividend of $0.28 per common share, 7.7% higher than a year earlier, payable Dec. 18, 2026, to shareholders of record on Dec. 4. As of Sept. 30, Kimco owned interests in 561 U.S. shopping centers and mixed-use properties totaling 99 million square feet of gross leasable area.

Sources: Kimco Realty press release, Nov. 2, 2026; Kimco Realty third-quarter 2026 results release, Oct. 29, 2026.