Wheeler Real Estate Investment Trust, Inc. (NASDAQ: WHLR) shares are experiencing a substantial rise following a favorable litigation outcome. As of the most recent pre-market check, WHLR shares have soared 95.80% to $8.11. This remarkable increase follows a prior surge of over 300%, which had seen the stock close at $4.14. The dramatic appreciation in the stock price comes in the wake of a recent legal triumph for the company.
Court Decision Affirmed
Wheeler and Cedar Realty Trust, Inc. got confirmation of a favorable court ruling on September 4, 2024. A 2023 decision from the US District Court for the District of Maryland was maintained by the US Court of Appeals for the Fourth Circuit. This ruling rejected a class action case against Cedar, Wheeler, and Cedar’s previous board of directors, filed by purported holders of Cedar’s preferred stock, under the name *Kim, et al., v. Cedar Realty Trust, Inc., et al.*.
In this decision, the appeal court highlighted that courts hear legal issues rather than acting as “time machines for disgruntled buyers.” It concluded that the plaintiffs had not sufficiently demonstrated any violation of legal rights or duties by the defendants, instead merely expressing regret over their negotiated terms.
Strategic Implications and Portfolio Performance
Wheeler’s acquisition of all of Cedar’s common stock in August 2022 had led to the aforementioned legal claims, including allegations of contract breaches and fiduciary duty violations. The favorable appellate decision represents a significant victory for both Wheeler and Cedar, positioning them strongly to advance their strategic initiatives.
In addition to the legal success, Wheeler’s recent quarterly highlights reveal robust performance in its real estate portfolio. The portfolio was 90.8% occupied, slightly down from 90.9%, but the leased rate increased to 93.8% from 92.6%.
The portfolio includes 33 fully leased properties, with 40 lease renewals executed, covering 188,152 square feet, and achieving a weighted average rental increase of $1.15 per square foot—a 10.8% rise over existing rates. Furthermore, nine new leases totaling 85,487 square feet were signed, reflecting a weighted average rental rate of $13.47 per square foot and a notable rent spread increase of 29.9%.