By Elias Schisgall
Centerspace will sell up to $245 million in assets this year and exit from certain markets as part of a portfolio optimization and deleveraging plan.
The plan follows a review of strategic alternatives by Centerspace's board. The operator of apartment communities said it is targeting selling between $240 million and $245 million in assets this year, comprising 12 communities.
The company said it plans to fully exit from the Bismarck, N.D., and Rapid City, S.D., markets and sell one community in Denver.
The plan is expected to decrease Centerspace's debt by between $175 million and $190 million and let the company repay the balance on its line of credit.
The ratio of pro forma annualized net debt to earnings before interest, taxes, depreciation, and amortization is also expected to fall to below 7x in the fourth quarter of this year from 8.2x in the first quarter.
Centerspace may also declare special distributions of between $45 million and $65 million later this year, the company said.
"The capital allocation initiative we are announcing today is an outcome of our review process," Chief Executive Anne Olson said. "We expect these actions to enhance shareholder value by capturing the discount between public and private market valuations, while materially strengthening our balance sheet and positively evolving our market exposures."
The company said it plans to provide updated guidance that considers the impact of the portfolio optimization alongside its second-quarter results.
Write to Elias Schisgall at elias.schisgall@wsj.com
(END) Dow Jones Newswires
June 01, 2026 16:50 ET (20:50 GMT)
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