Wednesday, August 29, 2007

Eurochem Signs $61 Million Build to Suit of Business Park in Singapore

Channel News Asia - August 27, 2007

MacarthurCook Industrial REIT has made its first acquisition since listing on the Singapore Exchange. It is buying a business park complex in Jurong East from Eurochem Corporation for S$91 million ($61 million) in a sale and leaseback arrangement.

The acquisition, funded fully by debt, will increase the size of MacarthurCook's portfolio to S$407 million. Eurochem will sign a lease for 10 years with an option to extend for another five years. The lease will start from the date of completion, which is scheduled for December 2009.

Eurochem is a Singapore-based company operating in the petrochemical sector. Sphere: Related Content

Thursday, August 23, 2007

Canadian Government Completes $1.64 Billion Sale Leaseback of 9 Office Buildings Across Canada

The Globe and Mail - August 21, 2007

The Canadian federal government has sold nine office properties to privately held Larco Investments Ltd., a Vancouver-based real-estate company, for $1.64 billion, under a 25 year sale leaseback agreement. The buildings are located in Vancouver, Edmonton, Calgary, Toronto, Ottawa and Montreal.

Royal Bank of Canada and Bank of Montreal, the investment banks which ran the bid process, initially contacted 91 potential bidders, all of whom were required to be majority Canadian-owned.

Of the $1.644-billion purchase price, $1.567-billion will go to the government. Of this, RBC and BMO will each receive commissions of $5.7-million, according to a government official. There will also be up to $500,000 in expenses for the sale. The remaining $77-million of the sale price will be used to undertake a 10-year capital repair program, while the government will be responsible for other expenses, including maintenance, repairs and other building improvements.

The government has agreed to lease back the nine buildings for 25 years, with payment amounts rising in five-year increments. Lease payments will total $505.3-million over the 25 years, rising from $82.2-million in the first five years, to $122.1-million in years 20 to 25. (This reflects an initial rent of approximately $82 million per year, or a 5.25% cap rate, with increases of approximately 10% every five years). Sphere: Related Content

Wednesday, August 15, 2007

Allianz Completes EUR 1.3 Billion Sale Leaseback of 7 Office Buildings in Germany

IVG Immobilien AG Web Site - August 13, 2007

IVG Immobilien AG, one of Europe’s major listed real estate companies, has acquired an office property portfolio from Allianz for a purchase price of about € 1.3 billion. The so-called “Core Portfolio” includes seven high-quality office properties in the cities of Frankfurt, Hamburg, Munich (3 properties) and Stuttgart (2 properties). The total rental floor space amounts to 441,000 square metres.

The properties have been fully let long term to Allianz. The agreed purchase price corresponds to a net initial yield of 5.3 per cent after incidental acquisition costs. Ownership of some of the properties will pass to IVG at the end of 2007, while in other cases ownership will pass at the beginning of 2008. Sphere: Related Content

Monday, August 13, 2007

Lloyd’s of London Building Offered for £320 Million

Property Week - August 10, 2007

One of the best-known office buildings in London is about to come to the market. Commerzbank subsidiary CLI Group, which initiates and manages closed-ended funds, is selling the distinctive Lloyd’s of London building, designed by Lord Rogers, with a price tag of around £320m. The annual income from the 310,000 sq ft building is around £17m and a sale would reflect a yield of around 5%.

The news comes at a time when a credit crisis in the financial markets and rising interest rates are causing some investors to reconsider property deals. Savills is advising the vendor and is thought to have already approached several parties seeking an off-market transaction. Sources say it is likely the building will be brought to the market more widely this autumn after the August lull.

The sale will attract interest from institutions as well as wealthy overseas investors given the solid covenant of the UK’s largest insurance company, its long lease, its status and its prime location in the City.

CLI, which holds the scheme in its CFB Fonds 154 fund, bought the building from fellow German open-ended fund manager Deka for £231m in 2004 with a £141m loan from Hypo Real Estate. Deka bought the building upon its completion in 1986 for £180m from insurer Lloyd’s in a purchase and leaseback, before selling it to CLI.

The Lloyd’s lease at the Leadenhall Street building, which is considered to be one of the best examples of modern architecture in the world, expires in 2021. It has one tenant break option within the lease agreement.

Despite apparent warning signs of a market slowdown, investor interest in the City and Midtown markets for well-situated and let buildings shows no sign of abating. Last month Invista Real Estate and Delancey sold their 350,000 sq ft Mid City Place in Midtown for around £330m to US fund manager Beacon Capital Partners at a yield of around 4.25%.

Last year GIC Real Estate, the government of Singapore’s property arm, bought the Merrill Lynch Financial Centre at 2 King Edward Street in the City in a £490m purchase and leaseback. The financial services company took a 15-year lease on the building. GIC’s president, Dr Seek Ngee Huat, said it had bought the building because it was a ‘compelling investment opportunity due to its high specifications and modern design, and the strength of Merrill Lynch’s commitment.’

The rise in the cost of finance and credit problems in some areas of the banking world means the sale of the Lloyd’s building may not attract many heavily debt-backed buyers. Sphere: Related Content

Saturday, August 11, 2007

Konsortium Logistik Planning $74.5 Million Sale Leaseback of Warehouses in Malaysia

Business Times Online - August 9, 2007

Konsortium Logistik, Malaysia's biggest logistic provider for the local car industry, could return as much as RM120 million or 49 sen a share to shareholders as part of a restructuring exercise, JPMorgan said in a report. The US investment bank based its report on information obtained from the management of Konsortium, Malaysia's biggest logistic provider for the local car industry.

The report issued on Tuesday said Konsortium plans to adopt an asset-light strategy by selling most of its landed assets earmarked for future development in Malaysia and abroad. It also plans a sale and leaseback exercise for its warehouses.

These could raise as much as RM250 million ($74.5 million) for Konsortium and place it in a net cash position of RM150 million by year-end. The firm also hopes to institute a generous dividend policy by paying out all of its operating profit. "The complete streamlining of its operations will result in Konsortium only focusing on vendor supply chain management for the car sector and government project concessions," JPMorgan said.

Meanwhile, Konsortium also plans to reduce its capital expenditure by leasing some 200 new trucks in the future to replace its ageing fleet. "The future 200 new trucks will be leased and will not be on the balance sheet. The new leases are expected to generate a five-year payback period," the report said. Sphere: Related Content

Royal Bank of Scotland Agrees to Pre-Let of Bankside Offices in London

Easier Property - August 8, 2007

Land Securities Group PLC has announced that it has exchanged contracts with the Royal Bank of Scotland plc (“RBS”) for the pre-letting of the Bankside 2&3 development on London's Southbank, SE1.

RBS will take a 20 year lease occupying a total of 377,910 sq ft over the two buildings, with rental levels of £46.50 being achieved for the best space. This transaction completes the office space within the 940,000 sq ft mixed-use estate. Building 1, the Blue Fin Building, is occupied by IPC Media following its forward sale in May 2004.

Located behind Tate Modern, Bankside 123 has created a diverse and vibrant environment for the area’s expanding business community, retailers and residents. The trio of buildings set within interconnected public spaces will open up access from Southwark to the riverside.

CB Richard Ellis represented Land Securities and Drivers Jonas advised RBS. The retail element of the scheme is being marketed through CB Richard Ellis. Sphere: Related Content

Friday, August 10, 2007

Restoration Hardware Enters Build to Suit Agreement for 800,000 SF Distribution Center

SEC Edgar Database - August 7, 2007

On August 7, 2007, Restoration Hardware, Inc. entered into a Lease Agreement, effective as of August 3, 2007, with Duke Realty Limited Partnership pursuant to which the Company will lease from the Landlord an approximately 800,000 square feet distribution facility in the Village of West Jefferson, Ohio.

The Leased Premises will be used primarily for fulfillment to the Company’s East Coast retail stores and its non-furniture direct-to-customer business. The Leased Premises will be constructed by the Landlord and is expected to be completed in June 2008. The term of the Lease is 15 years after completion of the Landlord’s construction of the Leased Premises. The Company has the right to extend the lease for three additional periods of five years each.

The annual rent under the Lease will be approximately $3.2 million per year for years one through five, approximately $3.5 million per year for years six through ten, and approximately $3.8 million per year for years eleven through fifteen. The Lease also provides the Company with certain options to expand the Leased Premises. Sphere: Related Content

Wednesday, August 08, 2007

Vertex Completes $26 Million Sale Leaseback of HQ Near Philadelphia

Cityfeet / GlobeSt - August 6, 2007

The Westphal family, which owns Vertex Inc., a tax software company, has sold the company's headquarters, the Cassford Office Complex at 1041 Old Cassatt Rd., to Conshohocken-based Trinity Capital Advisors. At the close, Vertex inked a 10-year lease for the 131,000-sf, five building complex.

To fund the buy, TCA obtained a $22.5-million fixed-rate acquisition loan, arranged by Philadelphia-based BlueStone Real Estate Capital. Kris Wood, BlueStone’s managing director, secured the funding from JP Morgan. It has an 85% loan-to-cost ratio, which puts the price tag for the property at nearly $26.5 million, or just above $202 per sf.

Without disclosing the value of the Vertex lease agreement, Matthew McManus, chairman of BlueStone says that market rents in the area range between $19.50 per sf and $24 per sf. The Cassford complex was completed in 2001. Sphere: Related Content

Monday, August 06, 2007

HSBC Nearing £100 Million Sale Leaseback of Office Building in London

Property Week - August 3, 2007

PruPim is to carry out a purchase and leaseback of HSBC’s 62-76 Park Street in south London for more than £100m. HSBC put the 173,000 sq ft building, near the Tate Modern on London’s South Bank, on the market last month as part of its sale-and-leaseback programme to raise cash.

HSBC is taking a 20-year lease at £5.1m a year, and has an option to extend for five years. The sale follows CB Richard Ellis’s review of HSBC’s property portfolio, which resulted in the £1bn Canary Wharf headquarters sale and reflects a yield of 4.7%.

CB Richard Ellis advised HSBC; Catella acted for Prupim. Sphere: Related Content

Friday, August 03, 2007

Westinghouse Electric Enters $220 Million Build to Suit Near Pittsburgh

Cityfeet / GlobeSt - August 1, 2007

Details of the previously announced development of Westinghouse Electric Co.’s planned nuclear energy headquarters office campus--believed to be the largest class A build-to-suit in the state’s history--have been finalized. Norcross, GA-based Wells Real Estate Investment Trust II Inc. has acquired an 82-acre parcel in the Cranberry Office Park northeast of Pittsburgh. Mine Safety Appliance Co. owns the business park. On condition of anonymity, an area broker tells the price of the land was $14 million. Wells has an option on an adjacent 23-acre parcel that would allow expansion of up to 1.2 million sf.

Dallas-based Trammell Crow Real Estate Development & Investment Inc., now an independently operated subsidiary of CB Richard Ellis, is developing the three-building, 770,000-sf complex, which will be owned by Wells REIT II. Westinghouse has signed a 15-year lease for the facility under an agreement that begins with completion of the second phase of the project.

Phase one calls for a five-story, 440,000-sf central building to be completed in mid-2009, followed by a second phase containing two four-story buildings of approximately 160,000 sf each that will flank phase one. They are scheduled for occupancy in mid-2010. The construction cost for both phases is $180 million. Sphere: Related Content

Kingfisher Completes £73 Million Sale Leaseback of Distribution Center in UK

Kingfisher plc Web Site - August 1, 2007

Kingfisher plc has agreed to sell its freehold property interest in B&Q's new 81,000 square metre (875,000 sq.ft) national distribution centre in Worksop, Nottinghamshire, to a private buyer for a total cash payment of £73 million.

The Worksop site, which was developed by B&Q, will be leased back at an open market rent payable monthly in advance and subject to five yearly index-linked reviews, with a cap. The lease allows B&Q significant operational flexibility. The disposal gives rise to a pre-tax exceptional gain of around £40 million. Kingfisher will use the proceeds to repay existing debt and invest in its worldwide store opening programme.

Duncan Tatton-Brown, Group Finance Director, said: "This is consistent with our policy of recycling property when economically attractive, with the aim of creating value for shareholders." Sphere: Related Content

Thursday, August 02, 2007

Luby's to Consider Sale Leaseback of Restaurant Portfolio?

Yahoo! Finance - July 30, 2007

Investment adviser Ramius Capital Group LLC and affiliated funds have asked the chief executive of Luby's Inc. to consider a sale of the restaurant chain, according to a regulatory filing Monday with the Securities and Exchange Commission.

"Given the available sources of financing, we believe a private equity firm could purchase Luby's at the current market price with little or no equity consideration," wrote Ramius partner Jeffrey C. Smith in a letter to Luby's President and CEO Christopher Pappas. Smith said Luby's could attract a "significant premium in a competitive sale process."

As an alternative, Smith also proposed a sale and leaseback transaction along with a stock buyback and special dividend. Smith estimated that Luby's real estate is worth between $206 million and $265 million pretax in a sale and leaseback transaction.

Smith also said the involvement of Pappas and other Luby's officers in the Pappas Restaurants chain, which is privately owned by the CEO and his brother, is creating conflicts and distractions that prevent action to increase shareholder value at Luby's.

A Luby's spokesperson was not immediately available for comment.

Ramius and its affiliates own a 6.5 percent stake in Luby's and claim to be the restaurant chain's largest independent shareholder. Smith asked Pappas to retain a strategic adviser to help pursue one of the two options. Sphere: Related Content

Auto Distribution Completes €85.3 Million Sale Leaseback of 51 Auto Service Centers In France

Business Immo - July 31, 2007

LaSalle Investment Management (LIM) has acquired, on behalf of the fund, LaSalle French Fund II, 51 Automobile Distribution (AD) centres, for €85.3 million. Purchased from RREEF, within the scope of a sale & leaseback operation, this deal follows LIM’s acquisition of Speedy centres of a few months ago. LIM has thus become the sector’s leading investor.

Colliers, and the consulting firms, LeBoeuf, Lamb, Greene & MacRae and Cheuvreux acted as advisers to LaSalle in the deal. Catella and the law firm, Freshfields acted as advisers to the seller. Sphere: Related Content

Wednesday, August 01, 2007

Carter Holt Harvey Completes $277 Million Sale Leaseback of Property Portfolio in New Zealand & Australia

egoli - July 30, 2007

Valad Property Group (VPG) announced it would acquire a portfolio of privately held retail depots and packaging plants for $277.3 million. The company said that the sale and leaseback arrangement provides Valad with strategically-located assets and long term income from a blue chip tenant.

The portfolio is operated by Carter Holt Harvey, which is a private company owned by New Zealand businessman Graeme Hart. The portfolio consists of 15 Carters retail warehouse depots in New Zealand, 10 packaging plants including five in Australia, and an office property in Auckland. The company said that five development sites located on the North Island of New Zealand are also included in the transaction. Sphere: Related Content

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