(Corrects former title of Michael Pappagallo to COO of Kimco in
By Ilaina Jonas
NEW YORK May 13 Brixmor Property Group,
Blackstone Group LP's neighborhood shopping center
business, on Monday said it named Michael Pappagallo, the former
chief operating officer of rival Kimco Realty Corp, as
its president and chief financial officer, potentially setting
the company up for an initial public offering.
The position will become effective May 20.
Pappagallo, who also served as the chief financial officer
at Kimco, will play an integral role in executing Brixmor's
long-term business and capital markets strategies, the company
said in a statement.
In addition, he will lead the company's finance and
accounting teams, and have some oversight of its property
operations, information technology, acquisitions, dispositions
and investor relations efforts.
The public market currently values these types of shopping
centers, which are typically anchored by grocers, 15 percent
higher than the private markets, Green Street Advisors analyst
Cedrik Lachance said.
"The odds of a public exit down the road are certainly
higher now than they've been for some time," he said. "The
hiring of someone with clear, long-term public market experience
at a large competitor of Brixmor gives further weight to that
public market strategy."
Blackstone also could sell the portfolio to another
publicly traded company, said a real estate executive who was
not authorized to speak on the record. Finding a strategic
partner to buy the portfolio would eliminate investment banking
underwriting fees. Shares would not incur an IPO discount and
their sale would not be subject to a lock up term.
"Ultimately, it really depends on the horizon that
Blackstone has on realizing market conditions and Blackstone's
own time horizon in terms of realizing their investment,"
A Blackstone spokesperson declined comment.
The company, born out of Blackstone's 2011 acquisition of
Australian-owned Centro Properties' U.S. properties, has a
portfolio of more than 600 U.S. properties, located in 39
Meanwhile, Kimco said it named Conor Flynn, the son of
Michael Flynn who has served Kimco's strategic adviser, as
executive vice president and chief operating officer, according
to a filing with the U.S. Securities and Exchange Commission.
(Reporting by Ilaina Jonas; Editing by Bob Burgdorfer)