Already Florida’s dominant grocer, Publix Supermarkets is making a bid to become a major landlord.
The Lakeland-based retailer late last week spent $71.5 million on Publix-anchored shopping centers in Wellington and Jupiter, according to property records.
Publix paid $52.8 million for the Courtyard Shops on Wellington Trace, a 39 percent increase from the 2008 sale price. And the grocer spent $18.7 million for the Sea Plum Town Center at 2525 Military Trail in Jupiter, a 43 percent jump from its last sale price in 2011.
In July, Publix paid $16.25 million for the Shoppes at Ibis in West Palm Beach.
The tight-lipped grocer hasn’t disclosed the thinking behind its aggressive real estate strategy, but Publix said in an annual report in March that it planned to invest $1.3 billion in 2015 to build new stores, remodel old ones, upgrade technology and buy real estate.
“The shopping center acquisitions are financed with internally generated funds,” Publix said in the regulatory filing — in other words, the Fortune 500 company doesn’t need mortgages.
Publix has changed its real estate strategy over the past decade. In 2006, Publix owned fewer than 11 percent of its stores. By the end of 2014, it owned nearly 23 percent of its locations, according to a Palm Beach Post analysis of Publix’s annual reports.
Publix owned 100 stores in 2005; it owns 251 now, an apparent bid to capture the real estate value it creates.
Publix is known for operating clean, well-located stores that bring in shoppers and, as a result, trade at a significant premium to Winn Dixie stores. One clue to Publix’s strategy: It’s employee-owned, which lets it take a more long-term focus than a publicly-traded retailer.
Retailers’ real estate strategies are all over the map. Office Depot says in its latest annual report that it owns just “a small number” of its locations. Wal-Mart, on the other hand, owns 85 percent of its stores.