Saturday, July 29, 2006

Cummins Signs Long Term Lease for HQ Office

Cummins Web Site - July 27, 2006

Cummins Inc. (NYSE:CMI) announced today that it has reached a new lease agreement on its Corporate Office Building, 500 Jackson St., that will keep the Company a central part of downtown Columbus for many years to come. The renewal takes effect Aug. 1, 2006.

The current lease was scheduled to expire July 31, 2009. The renewal, which runs through July 2019, offers the Company competitive lease rates and allocates funds to allow Cummins to make improvements to the facility.

Cummins owns the land on which the 390,000 square foot facility sits, but has leased the building from Newkirk Master Limited Partnership since 1983. Approximately 760 Cummins employees work in the building, which serves as the corporate headquarters for Cummins. Sphere: Related Content

Cisco Systems UK Headquaters Trades for £156 Million at 4.25% Yield

Property Week - July 27, 2006

Evans Randall, the privately owned investment bank, has bought Scottish Widows’ Lakeshore Scheme at Bedfont Lakes, Middlesex, for £156m.
In the biggest office transaction in the south-east outside London since 2000, Evans Randall has acquired three office blocks totalling 275,000 sq ft let to Cisco Systems. The purchase price reflects a yield of around 4.75%.

Evans Randall has spent nearly £500m on UK property in the last four weeks. It paid £197m for 33 Old Broad Street in the City of London and also bought five UK government fire control centres for £125m.

Michael Evans, chairman and chief executive at Evans Randall, said the bank hopes to invest up to £2bn on property in Europe next year. It is targeting properties priced between £75m to £300m.

Evans told Property Week: ‘What drives deals for us is the length of the deal, fixed increases in rent and exceptionally strong covenants like Cisco, which are rated by Standard & Poors as “A+”. We want to go for tenants rated “A” or better.’

The sale follows the regearing of Cisco’s lease at the offices in 2004. It has gone from paying £33.50/sq ft to £28/sq ft (£360.59-£301.39/sq m) and now has 19-years left unexpired on its lease.

The purchase price is the highest paid for offices in the south-east since 2000 when the entire scheme, totalling 750,000 sq ft (69,676 sq m), was bought by Scottish Widows from MEPC for £280m, reflecting a yield of 6.5%.

Jones Lang LaSalle acted for Scottish Widows; CB Richard Ellis advised Evans Randall. Sphere: Related Content

Friday, July 28, 2006

Bank of Ireland Seeking €250 million in Sale Leaseback of 36 Branches

Irish Times - July 26, 2006

Bank of Ireland is to launch a marketing campaign in September for the sale and leaseback of 36 of its branches in Dublin and other cities and towns. The initiative is expected to bring in between €230 million and €250 million.

AIB is also set to unload much of its branch network to free-up substantial capital for its banking operations. CB Richard Ellis, which is advising Bank of Ireland, said it expected that the investments would be sold at yields of around 3 per cent but, inevitably, some of the higher profile buildings were likely to show lower returns for the purchasers.

The 36 branches to be offered for sale are among the best owned by the Bank of Ireland and include several Dublin offices. All the branches will be offered for sale on 25-year leases but 17 will have break options after year 15 while another, at Leeson Street in Dublin 2, will have break options in years five and 10 because of development potential. The rent roll for the entire portfolio will be over €9 million.

In all cases the sale and leaseback terms will provide for a 15 per cent fixed uplift in the rent after five years. Subsequent reviews will be based on open market valuations.

The potential for rent increases will largely depend on the areas designated as retail use as opposed to offices. Consequently, buildings with two floors in retail use - such as O'Connell Street in Dublin and Eyre Square in Galway - will inevitably show the best return once open market valuations are the norm.

The move by the banks to embark on sale and leaseback programmes will be welcomed by the investment industry - from the pension funds and insurance companies to the investment syndicates and private investors.

Commercial investments have been in particularly short supply in the Republic in recent years, with many investors forced to look abroad for investment opportunities. The shortage means that investments on even secondary streets in Dublin have been selling for record yields of 1.5-3 per cent. More recently, a retail investment on Grafton Street changed hands at a yield of 1 per cent.

For the banks, the sale and leaseback exercise will free-up substantial funds which are effectively dormant. Once the sales have been completed, the banks will be in a position to produce a better return on their assets. Sphere: Related Content

Thursday, July 27, 2006

Buffets to Acquire Ryan's Restaurant Group for $876 Million in Sale Leaseback Transaction

Ryan's Restaurant Group Web Site - July 25, 2006

Buffets, Inc., a leading owner and operator of buffet-style restaurants, and Ryan's Restaurant Group, Inc. (Nasdaq: RYAN), the leading publicly traded buffet operator, today announced the signing of an agreement under which a subsidiary of Buffets will merge with Ryan's in a cash transaction valued at approximately $876 million, including debt that will be assumed or repaid at or prior to closing. Buffets is owned by an investment partnership organized by Caxton-Iseman Capital, Inc., a New York-based private equity firm, and the senior management of Buffets.

The transaction will create the nation's largest buffet restaurant chain and one of the five largest companies in the casual and mid-scale dining segment. The combined company will have annual revenues of more than $1.7 billion, a national footprint, and operate approximately 675 restaurants principally under the well-respected Ryan's(R) Grill, Buffet & Bakery, Fire Mountain(R), Old Country Buffet(R) and HomeTown Buffet(R) brands.

Under terms of the agreement, which has been unanimously approved by the boards of directors of both companies, Ryan's shareholders will receive $16.25 in cash for each common share they own, representing an approximate 45% premium over Ryan's closing share price on July 24, 2006.

The combined company will continue to be called Buffets, Inc. and will continue to be headquartered in Eagan, Minnesota. Ryan's will operate as a separate division of Buffets and will continue to be based in Greer, South Carolina. R. Michael Andrews, Chief Executive Officer of Buffets, will continue to serve in this capacity for the combined company, which will have approximately 43,000 employees.

(Note - Ryan's Restaurant Group owns substantially all of its 340 Ryan's(R) Grill, Buffet & Bakery and Fire Mountain(R) restaurant properties, each of which is a free-standing masonry building of approximately 8,000 to 12,500 square feet. The portfolio has a net book value of approximately $710 million according to the companys 2006 10-K filing.) Sphere: Related Content

Sunday, July 23, 2006

Bristol-Myers Squibb Pursuing Sale Leaseback of 900,000 SF Office Campus in Princeton - July 20, 2006

Pharma giant Bristol-Myers Squibb is putting a total of 900,000 sf of office space on the market at two locations here as the company restructures its real estate holdings, has learned. And company officials say they're looking for a sale-leaseback deal. 'The company will remain at both sites and sign long-term leases,' a spokesman says.

And BMS has hired locally based Garibaldi, Morford & Dodds/Corfac International to advise it on the offering, has learned. Handling the assignment are Robert Morford, Gerald E. Moore Jr. and Gerald A. Bower Jr. of Garibaldi's Financial Services Division.

"This portfolio is well positioned," Morford tells GlobeSt. "It should attract investors seeking quality, well-located office space leased to a credit tenant that's committed to the community."

The two locations are 777 Scudders Mill Rd. and 100 Nassau Park Blvd. here. Built in 1993, 777 Scudders Mill Rd. is situated on approximately 106 acres within Princeton Forrestal Center. The property consists of three, five-story office buildings connected by an underground service concourse. Among the concourse's amenities is a television/media studio. The site also has final approvals in place for a fourth five-story office building, as well as preliminary approvals for two additional buildings.

The 100 Nassau Park Blvd. property, meanwhile, was built in 1986. It consists of a three-story class A office building with a centralized atrium. Sphere: Related Content

Lexington and Newkirk Merge and Create Leading Single Tenant REIT

Lexington Corporate Properties Trust Web Site - July 23, 2006

Lexington Corporate Properties Trust (NYSE: LXP - News) and Newkirk Realty Trust, Inc. (NYSE: NKT - News) announced today that they have entered into a definitive merger agreement to create Lexington Realty Trust, the leading real estate investment trust focused on single tenant properties.

The merger will create a combined company which will own interests in more than 350 properties located across 44 states with a presence in the nation's highest growth markets. Based on Friday's closing prices, the combined entity would have an enterprise value of approximately $4.6 billion. Investment grade tenants, in the aggregate, will represent approximately 56% of annualized base rent.

Following the merger, Newkirk shareholders and unitholders will own approximately 46.8% and Lexington shareholders and unitholders will own approximately 53.2% of the combined company assuming no conversion of Lexington's Series C Cumulative Convertible Preferred Stock. Sphere: Related Content

Tuesday, July 18, 2006

Metro AG Enters $696 Million Sale Leaseback of 16 Hypermarkets in Poland - July 18, 2006

GE Real Estate Central Europe, a unit of the world's second-largest company, bought 16 hypermarkets from Casino Guichard-Perrachon SA for 555 million euros ($696 million) to more than double its retail assets in Poland.

GE Real Estate will lease the 319,000 square meters of space for 10 years to Metro AG, Germany's largest retailer, which yesterday bought Casino's Polish retail chain for 224 million euros, GE said in an e-mailed statement received late yesterday.
Real estate investors are targeting central and eastern Europe, where property is cheaper and potential returns are higher than in more mature European markets such as France and Germany.

Casino, France's fifth-largest supermarket chain, which operates under the Monoprix and Spar names, yesterday also sold its Leader Price supermarket chain in Poland to Tesco Plc, the U.K.'s largest food retailer, for 105 million euros.

Casino has retained some other real estate assets, valued at 130 million euros, which it plans to sell separately. It sold its Polish assets to reduce debt. Sphere: Related Content

Denver Newspaper Agency Nearing $88 Million Sale Leaseback of Denver HQ - July 18, 2006

The Denver Newspaper Agency is working on a deal to sell the new $88 million joint headquarters of The Denver Post and the Rocky Mountain News and lease it back from the buyer. The agency hopes to announce the deal within about 10 days, just before the newspapers begin moving into the 300,000-square-foot building at Colfax Avenue and Broadway.

"We're not in the real-estate business," said Dan May, senior vice president and chief financial officer of the DNA. "We want to be a more traditional group that leases its downtown real estate."

May declined to identify the investors interested in buying the building. The performance of interest rates has been advantageous, May said. When the DNA financed the building, rates were low. Now, with rates rising, it might make sense for the agency to lock in a lease rate that would make its payments predictable for a long period. If interest rates rise, as many people expect, locking in payments over the long term would be beneficial for the DNA, May said.

In the negotiations, various terms are being discussed. They involve different ways the deal could be structured, including a possible option for the DNA to repurchase the building. Sphere: Related Content

Kingfisher Enters Eur 287 Million Sale Leaseback of Seven B&Q Stores

Kingfisher plc - July 14, 2006

Kingfisher plc and The British Land Company PLC have agreed a deal on seven B&Q Warehouse large format stores. Kingfisher plc has sold a subsidiary company, which owns the seven stores, to The British Land Company PLC for a total cash payment of £198 million (€287.47m).

The stores, all freehold, are in prime edge of town locations in Ashford, Bury, Exeter, Glasgow, Grimsby, Lincoln and North Shields. The stores are approximately 100,000 sq ft each and, in total, extend to nearly 700,000 sq ft. The portfolio represents approximately 7 per cent of Kingfisher’s total freehold and long leasehold assets.

The stores are let at current market rental levels to B&Q PLC (Kingfisher’s main UK subsidiary) on 20-year leases with the tenant having an option to break after 15 years.

The leases have been structured to provide significant operational flexibility through assignment, under-letting and alterations. The rent is payable monthly in advance and will be uplifted annually in line with the change in the Retail Prices Index, subject to a cap. This reflects B&Q’s desire to align property occupation costs more closely with the operating business environment. It will limit B&Q’s rental increases for the stores and protects the business from any increases above the current rate of inflation. It also provides stability and certainty of cashflow for B&Q.

Terry Hartwell, Group Property Director of Kingfisher, said: “Through this transaction, Kingfisher is taking advantage of the current buoyancy in the direct property investment market in the UK to finance its operational business at attractive rates going forward. The proceeds of the transaction will be used to repay existing debt and to invest in Kingfisher’s worldwide store opening programme, including further freehold acquisitions.” Sphere: Related Content

Wells Fargo Seeking $300 Million Sale Leaseback of Office Building in San Francisco

San Francisco Chronicle - July 15, 2006

Wells Fargo & Co. has put its office building at 333 Market St. up for sale, about 18 months after purchasing it and sinking $35 million into renovations. The asking price was not disclosed. The bank said it will offer to sign a 20-year lease with the new owner of the 33-story, 646,000- square-foot property.

Wells Fargo employs about 1,000 workers at 333 Market St. in various divisions including home mortgage, private client services and administration. Other tenants include the General Services Administration and Hotwire.

Wells Fargo officials said the strengthening commercial real estate market prompted the sale. The bank employs 8,000 workers in San Francisco and is headquartered at 420 Montgomery St. Sphere: Related Content

Saturday, July 15, 2006

Australian Taxation Office Leases New $200 Million Tower at Sydney’s World Square

Multiplex Group - July 14, 2006

Multiplex Group is pleased to announce the Australian Taxation Office (“ATO”) has signed an Agreement for Lease to fully occupy a new commercial office tower at the last remaining site at Sydney’s World Square.

The 23,000 square metre facility, known as Latitude East, will be developed and built by Multiplex. The Building will front Goulburn and Pitt streets adjacent to the Ernst & Young Centre in the midtown precinct of the Sydney CBD. The 10 level building which has an estimated value on completion of around $200 million incorporates large efficient floorplates of approximately 2,500 square metres.

The ATO has signed a 15 year lease agreement, plus three five year options. Sphere: Related Content

Friday, July 14, 2006

Rank Group Agrees to $316 Million Sale Leaseback of 43 Bingo Clubs and Casinos

Rank Group Plc - July 14, 2006

The Rank Group Plc (‘Rank’) has agreed a net £172m transaction with Earth Estates Limited and Solarus Estates Limited (‘Earth-Solarus’) for the sale and leaseback of 43 of Rank’s UK properties and the transfer of liabilities relating to a further 44 surplus leasehold properties.

The agreement includes the £211m sale and leaseback of a portfolio of 40 Mecca bingo clubs and four Grosvenor casinos (one property comprises both a casino and a bingo club). Rank will lease back the properties over 15 years at an initial rate of £11.2m per annum. This represents an initial yield of 5.3% on the freehold portfolio. The book value of the properties was £137m.

In addition, Rank will transfer to Earth-Solarus liabilities relating to 44 surplus leasehold properties. The leasehold liability transfer price is £39m. There will be a pre-tax net book gain on the transaction of approximately £53m. It is not anticipated that the transaction will attract any capital gains tax. The proceeds of the transaction will be used to pay down debt.

Both Earth Estates Limited and Solarus Estates Limited are joint venture companies between William Pears and the Khalastchi family. Sphere: Related Content

Thursday, July 13, 2006

InterContinental Hotels Group Agrees to $804 Million Sale Manageback of Seven Hotels

InterContinental Hotels Group PLC - July 13, 2006

InterContinental Hotels Group PLC ('IHG') today announces it has agreed to sell a portfolio of seven InterContinental branded hotels (2,537 rooms) located in Continental Europe to the Morgan Stanley Real Estate Funds ('MSREF'). The transaction is expected to complete in the third quarter of 2006.

IHG has retained 30 year management contracts on the hotels, with two 10 year renewals at IHG’s discretion giving a total potential contract length of 50 years. The portfolio has been sold for €634m (£440m) ($804m) in cash before transaction costs, approximately €80m ($101m) above net book value of approximately €550m, with no material tax charge arising. In addition, MSREF has agreed to make capital investments in the portfolio for approximately €60m, including implementing new brand initiatives and adding further facilities to these prestigious hotels.

In 2005, these seven hotels generated revenues of €185m, EBITDA of €42m and EBIT of €23m before management fees. Normalised management fees from the management contracts are expected to be approximately €10m per annum going forward.

On completion of this transaction, IHG will have sold 175 hotels with a net asset value of more than £2.8bn since separation from Six Continents in April 2003. Sphere: Related Content

Wednesday, July 12, 2006

GSA Agrees to $21.7 Million Office Building Build-to-Suit in Atlanta

Businesswire - July 10, 2006

Highwoods Properties, Inc. (NYSE: HIW), the largest owner and operator of suburban office properties in the Southeast, today announced that it has been awarded a 91,000-square foot build-to-suit contract with a long-term lease by the General Services Administration (GSA) to develop a Class 'A' office building with structured parking for the Department of Homeland Security. The cost of the project is approximately $21.7 million and includes the purchase of two acres of land. Construction will commence in the fourth quarter and the project is expected to be completed in the third quarter of 2007.

Ed Fritsch, president and chief executive officer, commented, 'This is the fourth build-to-suit project we've been awarded by the federal government in the last two years. In 2005, we delivered 601,000 square feet for the federal government that was 100% pre-leased. These projects included a 138,000 square foot field office for the FBI in Tampa, a 109,000 square foot office building for the Centers for Disease Control in Atlanta and a 350,000-square foot office and storage facility for the National Archives and Records Administration (NARA) in Atlanta." Sphere: Related Content

Johns Hopkins Agrees to 243,000 Square Foot Office Build-to-Suit

CoStar Group - July 12, 2006

Johns Hopkins Applied Physics Lab (JHAPL) has signed on to lease the entire six-story, 243,000-square-foot proposed office building at 7651 Montpelier Road in the Montpelier Research Park.

Construction for the new complex is expected to begin later this month and reach completion in October 2007. JHAPL already leases five buildings in the Montpelier Research Park, which neighbors its 360-acre main campus on Johns Hopkins Road, also in Laurel.

The project architect is Morgan Gick McBeath & Associates. General contracting will be handled by Harvey-Cleary Builders. TC MidAtlantic Development Inc. is the developer. Sphere: Related Content

Friday, July 07, 2006

Kimberly-Clark Leases 806,000 SF Distribution Center Near Chicago

CoStar Group - July 3, 2006

In one of the largest industrial leases this year, Kimberly-Clark Corp. signed an 806,000-square-foot, full-building lease for a Duke Realty facility in Romeoville, IL. The property, which is under construction, will be known as Building 3 in the Park 55 industrial park.

The building is on a 35-acre site on Crossroads Parkway and is scheduled to deliver next month. Kimberly-Clark Corp. will use the building as a warehouse and distribution facility. Kimberly-Clark manufactures paper supplies and other goods ranging from personal care to professional heath care products.

David Kahnweiler and Charles Canale of Colliers Bennett & Kahnweiler represented Duke Realty. Keith and Matthew Stauber, also of Colliers Bennett & Kahnweiler, represented Kimberly-Clark. Sphere: Related Content

Lafarge HQ in Paris Sold for Eur 150 Million

Forbes - July 4, 2006

Fomento de Construcciones y Contratas SA and Caja Madrid's 50:50 joint venture Realia has acquired Lafarge's headquarters in Paris for 150 mln eur, Cinco Dias reported, citing unnamed company sources. According to Cinco Dias, Lafarge will continue to lease the 10,000 square-metre building from Realia. Sphere: Related Content

Fila Enters $26 Million Sale Leaseback of Distribution Center Near Baltimore

citybizlist - June 30, 2006

Fila USA, acting as Brandon One Real Estate LLC, sold 7630 Gambrills Cove Road to First Industrial Realty, care of FR Net Lease Co-Invest Pro 6 LLC, for $26 million, or approximately $68 per square foot. Fila USA purchased the building in 1999 and is leasing back the property for the next 15 years.

The 384,068-square-foot industrial building was constructed in 1997 and features 33 loading docks and two drive-in bays. Located in the Brandon Woods Business Park, the property is one of the largest small-parcel distribution facilities in the Mid-Atlantic. Sphere: Related Content

PDL BioPharma Signs 15-Year 447,000-SF HQ Lease in Freemont, CA - July 7, 2006

In one of the largest Bay Area leases this year, PDL BioPharma Inc. has signed a 15-year corporate headquarters lease for 447,000 sf at Pacific Shores Center, a 1.7 million-sf class A-plus office park here owned by San Francisco-based Jay Paul Co. The lease, which commences Jan. 1, 2007, represents a nearly 80% expansion for the publicly held biopharmaceutical company and fills most of the vacant space within Pacific Shores Center.

PDL is currently housed in a mix of owned and leased buildings in Fremont, which sits just across the San Francisco Bay from Redwood City. At Pacific Shores Center, it will occupy 1500 Seaport Boulevard, a 164,000-sf building currently in shell condition that will be built out as lab space, and 1400 Seaport, a 283,000-sf fully finished and furnished building that that will house its administrative offices.

PDL is subleasing 1400 Seaport from OpenWave Systems Inc. for the first seven years. The sublease will convert to a direct lease with Jay Paul upon expiration and will run co-terminus with the 1500 Seaport lease, both expiring on Dec. 31, 2021. The negotiated lease rates were not released by the parties involved; the published triple-net asking rate for 1500 Seaport is $1.75 per sf per month. Sphere: Related Content

Maxtor Regional HQ Near Denver Sells for Over $60 Million - July 6, 2006

The 450,000-sf regional headquarters of Maxtor Corp. in Longmont, CO, has changed hands. Invesco of Dallas and Circle Capital Partners of Denver sold the facility to a New York-based investor group under the name FEIGA/Sandstone LP.

Sources tell that the property sold for upwards of $60 million and that Maxtor’s lease is “long-term.” The building has been primarily used for research and development and was the regional headquarters for Maxtor.

In May 2006, Maxtor was acquired by Seagate Technologies for $1.9 billion. Both companies manufacture hard drives. Sphere: Related Content

Thursday, July 06, 2006

Alcatel Closes €60 Million Sale Leaseback of Headquarters in Italy

Europe Real Estate - July 6, 2006

Europa Fund II, managed by Europa Capital, an independent European real estate investment management company, has completed its first investment in Italy, purchasing the headquarters of Alcatel Italia from the Italian subsidiary of the international telecommunications conglomerate for in excess of €60 million.

The research, development and office complex comprises a site in excess of 150,000 m² with over 70,000 m² of built space. Alcatel Italia have entered into a lease back of 48,000 m².

Europa intend to obtain planning permission for the future redevelopment of the site into a new research, development, laboratory and light industrial park with highly flexible accommodation to house a wide variety of occupiers from different hi-tech and industrial sectors. It is anticipated that the first 25,000 m² phase will be available for occupation in mid-2008.

Commenting on the deal, Christopher Curtis, Principal of Europa Capital responsible for Southern Europe, said: 'This investment provides Europa Fund II with a solid income stream coupled with the potential to add significant value through the planning process.' Sphere: Related Content

Johnson Service Group Enters Sale Leaseback of 79 UK Dry Cleaning Stores

Laundry and Cleaning News - July 6, 2006

Johnson Service Group is disposing of, on a sale and leaseback basis, 79 retail trading properties currently occupied by the drycleaning division for the sum of £26.5million in cash on completion to Oceandale Investments and Oceandale Securities.

According to the group, proceeds from the sale will be used to reduce bank borrowings. The operating leases, signed in the name of Johnson Cleaners UK Ltd., are for 15 years with a break clause after 10 years. The gross and net book value of the properties is £13.2m and £12.3m respectively.

Trading conditions for the drycleaning division continue to be unpredictable, says the company in its pre-closing trading statement for the half-year to 30 June 2006, A cost reduction exercise is underway at all levels of the business, which should result in margins improving in the second half of the year.

Discussions about the future of the Johnson Service Group’s drycleaning businesses are continuing with an interested party that may, or may not, lead to an offer being received. Sphere: Related Content

Anthem Insurance Operations Center Sold for $100 Million - July 6, 2006

On behalf of its investors, Triple Net Properties LLC has purchased a two-building healthcare office property in Indianapolis, IN. The 100%-leased asset, located at 220 Virginia Ave., was purchased for $100.8 million. Dan Prosky, managing director with Triple Net’s healthcare properties division, says the quality of the asset, the sustainability of the tenant and an attractive 7% cap rate in the first year made the deal viable for the company’s investors.

The plaza includes two, five-story office buildings of approximately 562,000 total gross sf. The property includes surface parking next to the buildings and a long-term agreement with the City of Indianapolis for 2,000 spaces at the adjacent Conseco Fieldhouse garage. The property was constructed in 2000 as a build-to-suit for Anthem Insurance Cos. Inc. and is currently fully occupied by Anthem on an absolute net basis.

The property was purchased from institutional investors advised by Prudential Real Estate Investors. Triple Net represented the tenant in common buyers. Financing was provided by LaSalle Bank. Sphere: Related Content

Wednesday, July 05, 2006

Vue Entertainment Seeking £80 Million Sale Leaseback of Six UK Cinemas

Estates Gazette reports that Vue Entertainment has appointed HP Four to sell a portfolio of six cinemas following last month's £350m management buyout. The cinema developer and operator has appointed HP Four to sell the six UK cinemas, including the 65,000 sq ft Vue Leicester Square, for £80m, or a 5.5% initial yield. The properties are Vue's only freeholds and will be sold on a leaseback basis under 15-year leases on all except its West End flagship, where it will take a 30-year lease. The leases will have fixed yearly increases and open-market reviews every five years. Sphere: Related Content

Tuesday, July 04, 2006

Tradeka Ltd Completes Sale Leaseback of 270 Stores in Europe

Tradeka Ltd Web Site - June 28, 2006

As a part of its new real estate strategy Tradeka Ltd sells approx. 270 retail properties to European Property Investors LP (“EPI”), a fund managed by Curzon/IXIS AEW Europe. Tradeka Ltd leases the assets back with mainly long-term triple-net leases.

The portfolio consists of hypermarkets, supermarkets and neighbourhood stores and it contains a major part of Tradeka Ltd’s property holdings. The transaction has no effect on Tradeka Lts’s sub-tenants’ or partners’ positions and the store activities will continue normally. Genesta Property Nordic will be acting as the Curzon/IXIS AEW Europe local operating partner.

According to Mr. Markku Uitto, the CEO of Tradeka Ltd, the transaction supports Tradeka Ltd’s strategy to concentrate on core business and to increase Tradeka Ltd’s capital use efficiency. The capital released from the property holdings will be used to develop Tradeka Ltd’s capital structure and to make Tradeka Ltd’s growth strategy possible. Sphere: Related Content

UPM-Kymmene Enters EUR 77 Million Sale Leaseback of Group HQ in Helsinki

UPM-Kymmene Web Site - July 3, 2006

UPM has sold the share capital of its Group Head Office real estate at Eteläesplanadi 2 in Helsinki to the German Allianz Lebensversicherungs-AG for approx. EUR 77 million. UPM will book a capital gain of around EUR 37 million from the sale.

UPM’s Group Head Office will continue to occupy the Eteläesplanadi 2 premises under a long-term lease. Around 300 corporate and divisional staff work at the Eteläesplanadi 2 premises.

Allianz Lebensversicherungs-AG and the company managing its real estate property, Allianz Immobilien GmbH, are part of the Allianz Group. Allianz Immobilien GmbH manages a real estate portfolio with a market value totalling approx. EUR 15.3 billion and an annual rental yield of EUR 1 billion. Sphere: Related Content

Monday, July 03, 2006

Halifax plc Building in London Sold for Eur 266 Million

Europe Real Estate - June 29, 2006

Evans Randall, the privately-owned investment banking group, has acquired 33 Old Broad Street, London EC2 for €266.4 mln (£197 mln), as part of its ongoing programme to acquire up to €2.71 bln (£2 bln) of real estate assets throughout Europe during 2006/2007.

The 192,300-sq-ft office building, located in the central core of the City of London, is let to Halifax plc, a wholly owned subsidiary of HBOS, on a 35-year lease with 33 years remaining. The current rent is approximately £8 million a year and the lease contains fixed rental uplifts every five years at 2.56% p.a. compound.

Evans Randall acquired the building from a joint venture between Prestbury, West Coast Capital and Bank of Scotland, advised by Franc Warwick. Evans Randall was advised by its retained agent, CB Richard Ellis.

Michael Evans, Chief Executive of Evans Randall, said: £33 Old Broad Street fits perfectly with our strategy to acquire large commercial assets occupied by tenants with strong covenants, on leases with fixed or index-linked rental uplifts. We are actively looking to acquire similar assets throughout Europe.

To date it has acquired close to £1.5 billion of UK and mainland European property investments on behalf of clients. Major transactions include: ING Bank’s €225 million landmark building at Haagse Poort The Hague, Netherlands. The head office of the Financial Services Authority at 25 North Colonnade, Canary Wharf, London E14, for £200m. ABN AMRO’s London headquarters at 250 Bishopsgate, London EC2, for a similar figure. The European headquarters of 3M in Bracknell, Berkshire, for £75m. Sphere: Related Content

Saturday, July 01, 2006

Rio Tinto Commits to 20 Year Lease on European HQ

Estates Gazette Interactive reports that Derwent Valley and PruPIM have prelet their Telstar development in Paddington, W2, to mineral and metals company Rio Tinto for its new European headquarters.

Rio Tinto signed a 20 year lease on the entire 107,000 sf building at a rent of £4,954,000 per annum, with a 21 month rent free period. The development is due to complete in July 2007 at a cost of approximately £23m.

Derwent Valley is the development manager having sold the site to PruPIM for its Prudential Life Fund upon planning consent. The agreement with PruPIM reportedly includes a profit sharing arrangement determined by final cost of the building and its market value on completion. Sphere: Related Content

Coca-Cola Amatil Considering $90 Million Distribution Center Build-to-Suit near Sydney

Australian Financial Review reports that Coca-Cola Amatil is considering a sale and leaseback of its distribution center at Eastern Creek in Sydney's west to reduce capital expenditure and finance commitments.

CCA bought the land at Eastern Creek last year for around $35 million and planned to spend between $55 million and $60 million building a state-of-the-art distribution center. The company completed a simmilar $90 million semi-automated warehouse at its nearby Northmead facility.

CCA reportedly has no plans to sell and lease back its other distribution centers which it considers to have more strategic value. Sphere: Related Content

Singapore Airlines Completes $217 Million Sale Leaseback of Office Building

Singapore Airlines Web Site - June 28, 2006

77 Robinson Road Photo

Singapore Airlines Limited has sold the SIA Building, at 77 Robinson Road, to TSO Investment Pte Ltd, a fully-owned subsidiary of a property fund managed by CLSA Capital Partners.

The sale price, at $343.88 million, is equivalent to about $1,165 psf. The building is not a core asset for the Singapore Airlines business, and the Airline’s corporate offices are not located in it. The decision to sell the building was made as part of a regular review of the Airline’s non-core assets, and following a successful private tender exercise, conducted by CB Richard Ellis.

Singapore Airlines redeveloped the SIA Building in 1997. It is a 35-storey office building and comprises net floor area of approximately 295,000 sq ft, plus 180 car park lots.

Singapore Airlines will use proceeds from the sale for investment and growth of the Company and its subsidiaries. The sale is expected to be completed in eight weeks. Sphere: Related Content

BP Enters Build-to-Suit Agreement for New North Sea HQ in Aberdeen

Aberdeen Press & Journal - June 29, 2006

Oil and gas giant BP hosted a celebration yesterday to mark the start of the development of its new North Sea headquarters in Aberdeen.

The HQ, in Stoneywood Road on a 15-acre site, is being built by London-based developer Akeler and is expected to be completed in the second half of next year. The new offices will span 20,000sq m over seven wings on three levels. BP has agreed a 15-year lease for the new building, which will be owned by Akeler. The Stoneywood Road site was already owned by BP, which has options to extend the lease beyond 2022. The deal agreed with Akeler involves the developer taking over the site of BP's present HQ.

The complex is designed to accommodate about 1,200 staff - about 1,000 BP employees and 200 contractors. The existing offices house 1,700 people, and the 500 who are not moving into the new location are to shift to other accommodation elsewhere in the city. Sphere: Related Content

JP Morgan Chase Tower in San Francisco to Sell for $400 Million

Los Angeles Times - June 30, 2006

Irvine Co. is paying a record price for a skyscraper in San Francisco, evidence that the city's commercial real estate market is recovering from the tech crash.

The big Orange County land developer's agreement to spend more than $400 million for the 31-story JP Morgan Chase Building in the city's financial district is a vote of confidence in San Francisco's economic comeback, fueled in part by renewed expansion of the Bay Area's technology sector.

Financial service companies have been expanding for several months, followed by a boom in leasing by tech companies, he said. Office vacancy has dropped to less than 15% from its peak of 24% in 2002.

The 665,000-square-foot building at 560 Mission St. that Irvine Co. is buying is rented to financial service giant JP Morgan Chase, which signed a 15-year lease in early 2000 when the dot-com boom was at its peak and rents were significantly higher than they are now.

JP Morgan's expensive lease and the fact that the 4-year-old building was designed by well-known architect Cesar Pelli made it attractive to investors, Yasukochi said. Irvine Co. is paying close to $700 a square foot for the property, surpassing the previous record of $606 set last year by the sale of an office building in Mission Bay rented to Gap Inc.

The building is in escrow, said people with knowledge of the transaction, who asked not to be identified because the deal hadn't closed. Executives at Irvine Co. and the Morgan building's owners — Texas office developer Hines and the California Public Employees' Retirement System — declined to comment.

Irvine Co. is paying more than it would cost to erect a new building of the same size, but that would be easier said than done in development-wary San Francisco, where there are many barriers to new construction, said Grant Lammersen, an investment sales broker at Cushman & Wakefield.

Privately held Irvine Co. is controlled by developer Donald Bren, who is ranked 38th on the Forbes list of wealthy Americans with an estimated fortune of $5.7 billion. The company's holdings in Orange County date to 1864 and include 93,000 acres, about one-fifth of the county's total land area. The company also owns about 400 office properties from San Diego to Silicon Valley. The Morgan building would be its first in San Francisco. Sphere: Related Content

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