Federal Realty Investment Trust closed the sale of Misora Apartments, a 212‑unit Class A residential community located in the heart of Santana Row, San Jose, California, for $148.5 million on February 5 2026. The transaction represents the largest residential disposition in the company’s recent portfolio‑recycling program and underscores its focus on divesting mature, non‑core assets to free capital for higher‑return opportunities.
In the same transaction window, Federal Realty sold Courthouse Center, a 33,000‑square‑foot neighborhood shopping center in Rockville, Maryland, for $10 million. While smaller in scale, the sale completes a broader strategy of trimming peripheral retail holdings and consolidating the company’s core mixed‑use and retail portfolio.
The two sales add to nearly $475 million of disposition proceeds generated over the past few quarters, with blended cap rates in the low‑5% range. Federal Realty’s capital‑recycling approach has been a cornerstone of its dividend‑growth strategy, allowing the company to maintain a consistent dividend‑king track record while preserving financial flexibility for future acquisitions and development projects.
President and CEO Don Wood said the company’s disciplined “pruning, reinvesting, and staying patient” philosophy drives these decisions. He noted that selling mature residential and small‑scale retail assets provides a cost‑of‑capital advantage that can be deployed into higher‑growth, core retail and mixed‑use opportunities, reinforcing the firm’s long‑term value proposition.
These asset sales illustrate Federal Realty’s ongoing portfolio optimization. By divesting non‑core properties, the company can reallocate capital toward projects that align with its core strengths in retail and mixed‑use development, potentially enhancing returns for shareholders while sustaining its dividend growth trajectory.
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