Galerias del Valle
Mexicali, Mexico
With Walmart and other major U.S. retailers making a big push to expand in Mexico over the last decade, Kimco saw a great opportunity and acted on it. Starting with two shopping centers in 2002, the company has grown its Mexico portfolio to 55 properties, with a total of almost 12 million square feet of retail space.
Galerías del Valle, in the border city of Mexicali, is a typical example. Opened in 2007, Mexicali’s newest shopping center offers 386,000 square feet of grocery, entertainment and service retailers in one convenient location. It is situated in a high-growth sector of Mexicali, the capital city of Baja California, which boasts one of the highest standards of living in Mexico. Nearly 400,000 people live within a five-mile radius, and their median household income is almost double the national average.
Kimco was confident that if it built Galerías del Valle, they (retailers and consumers) would come. And the company was right: the shopping center has become the area’s dominant retail location, with 94 percent occupancy and strong retail sales. Galerías del Valle is anchored by a 106,000-squarefoot Walmart Supercenter, and offers entertainment and dining choices ranging from a 10-screen Cinépolis theater, to such restaurants as Applebee’s, Burger King, Carl’s Junior and Subway, along with a Starbucks coffeehouse. Other well-known retailers in the 100-store center include Coppel, one of northern Mexico’s largest department store chains, and GNC.
Co-owned with GE Real Estate, Galerías del Valle in 2011 attracted 11 new tenants who filled 35,000 square feet of space, increasing the shopping center’s occupancy level from 91 percent to 94 percent. For the year, net operating income rose 28 percent. Kimco’s investment in Galerías del Valle is paying off, earning an annualized return of more than 13 percent.