Friday, November 30, 2007

AIB Agrees to EUR 30 Million Sale Leaseback of Bank Branch Portfolio in Ireland

Irish Independent - November 28, 2007

A private investor has agreed to acquire a portfolio of AIB properties in Munster in a major sale and leaseback transaction.

AIB had brought the 12 properties to the market last month, seeking offers of around €35m through Savills Hamilton Osborne King. But the ultimate agreement is believed to be significantly below this level.

Nevertheless the sale will provide a boost for the investment market, where deals have slowed since the credit crunch. However, the slowdown is believed to have taken its toll and the deal eventually may have been closer to €30m.

The original guide price indicated a net initial yield of approximately 4.25pc. But experts believe the yield was pushed out towards 4.5pc and maybe even beyond as bidders struck a harder bargain than similar transactions before.

AIB's Munster portfolio includes branches in strategic locations in towns such as Ennis and Limerick. Each property will be let to AIB with guarantees on a 20-year FRI lease with upward-only rent reviews every five years. The tenant has a break option in year 15.

Total initial income for the portfolio is €1,664,000, with individual properties generating rents of between €77,500 and €415,000.

The major banks have capitalised on their property portfolios, through lucrative sale and leaseback deals. However the credit crunch and higher interest rates have slowed investment activity across the board.

The strong AIB covenant nevertheless makes the Munster portfolio a cut above most regional properties, even though some might be considered less 'prime' than those snapped up in previous bank disposals over the past year.

The identity of the buyer is a closely guarded secret. But only investors with proven credentials are able to raise funds on the scale required to secure such a large deal in the current, more exacting financial environment.

The Munster portfolio has a total net internal lettable area of around 7,148sqm. Sphere: Related Content

Sunday, November 25, 2007

Santander Agrees to EUR 2.04 Billion Sale Leaseback of 1,173 Bank Owned Properties Throughout Spain

Property Week - November 22, 2007

UK pension fund manager Pearl Group is set to complete the biggest European real estate deal of the year with the E2bn (£1.4bn) purchase of more than a thousand properties owned by Spanish bank Santander, the largest bank in the euro zone by market value.

Pearl, led by entrepreneur Hugh Osmond has entered into an exclusivity period to buy Lot 5 – a portfolio of 1,173 properties, consisting predominantly of high-street banks. The portfolio generates a yearly rental income of approximately E101m (£72m), reflecting a yield of about 5%.

The portfolio forms the largest of five property packages placed on the market by the bank in the summer to help fund its joint bid with Bank of Scotland and Fortis for Dutch bank ABN Amro. The total value placed on all-five lots was E4bn (£2.87bn).

The lots initially received numerous bids over the course of the sale process, including bids for the entire portfolio, however the credit crunch reduced bidding numbers considerably and by October those bidding on all the properties either reduced their bids or joined forces opting to cherry-pick preferred assets.

The sale will be warmly received by a European investment market that has seen little in the way of large transactions, particularly since the liquidity crisis. A sale means that Santander will be left with Lot 1 - the bank’s headquarter scheme on the outskirts of Madrid – left to sell.

Last month, Zara-owner Pontegadea agreed to pay E500m (£359m) for Lots 2-4 which consists of 11 large commercial properties across nine cities. The deal is said to have reflected a yield of less than 5%. The sale will reportedly generate a capital gain of EUR 860 million.

None of the parties involved in sale would comment. Sphere: Related Content

Saturday, November 24, 2007

Kia Motors Considering $268.7 Million Sale Leaseback of Production Assets

Reuters - November 24, 2007

Kia Motors Corp (000270.KS), South Korea's No. 2 carmaker, plans to sell some domestic and overseas production lines and lease them back in the first half of next year in a deal that could fetch up to 250 billion won ($268.7 million), a Korean newspaper said on Saturday.

"To improve financial soundness, (the company) is seeking to sell part of Kia Motors' assets, including production lines, to a leasing company and secure cash," the Chosun Ilbo daily quoted an unnamed senior official at the automaker as saying.

Kia Motors could not immediately be reached for comment.

The report added GE Capital, a financial unit of U.S company General Electric Co (GE.N: Quote, Profile, Research), was the most likely buyer of the assets.

In October, Kia, an affiliate of top South Korean auto company Hyundai Motor Co (005380.KS: Quote, Profile, Research), had posted a bigger-than-expected quarterly net loss due to weaker sales and said it would miss its 2007 operating profit target as costs swelled.

Kia, which has factories in China and Slovakia, is building a $1 billion plant in the United States. ($1=930.3 Won) Sphere: Related Content

Friday, November 23, 2007

Sainsbury Completes $78.5 Million Sale Leaseback of Two UK Regional Distribution Centers

Property Week - November 23, 2007

Sainsbury’s has sold the second of four distribution depots it put up for sale earlier this year, completing two deals in two weeks which represent 1m sq ft in floorspace and just under £80m.

Canada Life has paid £40m to buy the 560,000 sq ft shed at Radial Park in Stoke on Trent. Sainsbury’s has taken a 25-year lease on the property at a net initial yield of 5.65%, again with RPI-linked rent reviews.

The other sale-and-leaseback, signed last week, was to BAE Systems Pension Scheme, which has bought the 425,000 sq ft warehouse in Tamworth for £38.5m and leased it back to the supermarket on a 30-year lease at a net initial yield of 5.5% with RPI- linked rent reviews.

The other two warehouses, in Hams Hall in the West Midlands and Haydock in Merseyside, are still on the market but interest is thought to be strong.

Peter Winfield, head of business space investment at Cushman & Wakefield which acts for Sainsburys, said: "These deals clearly demonstrate that there is institutional demand for high quality property in the current market which reflects the most challenging trading conditions in recent years."

Kitchen La Frenais Morgan acted for BAE, and Atisreal acted for Canada Life. Sphere: Related Content

Royal Bank of Scotland Awards $1.7 Billion Sale Leaseback of 63 Properties

Financial Times - November 23 2007

Royal Bank of Scotland has found a buyer for an £800m ($1.7bn, €1.1bn) portfolio of 63 properties. The price is about 10 per cent lower than originally expected but indicates that real estate deals are possible in spite of the credit squeeze. The preferred bidder on the RBS portfolio is understood to be Prudential, the insurer, which has joined forces with William Pears, a private family-run investment group.

The sale and leaseback agreement comes after several other property deals have been abandoned in recent weeks, including the attempted sale of Meadowhall Shopping Centre in Sheffield by British Land. But the price of the assets has been cut to £800m from an initial asking price closer to £900m in a sign of the weakening market.

William Pears and Prudential beat competition in the final round from Nick Leslau, the private property entrepreneur, working with HBOS. Other interested bidders had included Moorfield and Delancey, both private companies.

The 63 properties cover 2.1m sq ft and produce about £47m of annual rent, making a yield of 5.5 per cent. They include the Strand head office of Coutts, one of RBS’s private banking operations, and other branches including 1 Princes Street in Edinburgh and 28 Cavendish Square in London’s West End. RBS was advised by Cushman & Wakefield. The Scottish bank had put the portfolio up for sale to help raise money for the joint takeover of ABN Amro, the Dutch bank. Sphere: Related Content

Wednesday, November 21, 2007

Microsoft Signs Long Term Lease for $500 Million Data Center Near Chicago

Cityfeet / - November 9, 2007

Microsoft Corp. has signed a 15-year lease for a 550,000-sf data center at 601 Northwest Ave. The data center is being developed by a partnership of information technology company Ascent Corp., based in St. Louis, and property management company Koman Group, based in Creve Coeur, MO. The estimated cost of the project is $500 million.

The two-story building will be constructed on a 14-acre site near Interstate 294 and Interstate 290. The joint venture had acquired the slightly more than 14 acres and planned to construct a speculative building between 430,000 sf and 475,000 sf, says Phil Horstmann, president and CEO of Ascent. “Our original vision for the project was a purpose-building, speculative, multi-tenant data center,” Horstmann says. Microsoft’s lease rate was not disclosed but Jones Lang LaSalle had been marketing the building with an asking lease rate of $36 per sf, triple net.

The building was expected to have at least 200,000 sf with a raised floor and have 21-foot ceilings. The building was expected to have 40 megawatts of power with the ability to expand to 60 megawatts and, with working on the plans for the building with Microsoft, “The capacity has grown,” he says. The joint venture will also have its own power substation on the property.

The building is expected to be completed in the spring and open in April, according to a press release from Microsoft. The building will house “tens of thousands of servers providing information and web-based applications to Internet users worldwide,” according to the press release. Sphere: Related Content

Sodexho's New HQ in Paris Sold for €100 Million

King Sturge Web Site - November 19, 2007

On behalf of Custom House Capital, King Sturge, Paris and Knight Frank Ganly Walters, Dublin have purchased from Sefri-Cime and AXA REIM two office buildings, Panorama Seine and Dockside near Paris in Issy-Les-Moulineaux for more than €100 million.

Sodexho will be occupying both buildings on a 12 year lease and this will become their International Headquarters.

Panorama Seine comprises 7,893m² (84,959ft²) with 71 car parking spaces, due to complete in February 2008. Dockside comprises 2,128m² (22,906ft²) with 27 car parking spaces due to complete in April 2008.

Simmons & Simmons and Le Breton & Associés acted on behalf of Custom House. Sefri-Cime was advised by Pardieu Brocas Mafféi and Wagny Katz. The financing was done by Aareal Bank, who were advised by notaries Allez & Associés. Sphere: Related Content

Harleysville National Bank Agrees to $38.8 Million Sale Leaseback of 16 Retail Bank Branches in PA

SEC Edgar Database - November 19, 2007

On November 19, 2007, Harleysville National Bank, a wholly owned banking subsidiary of Harleysville National Corporation, entered into a definitive agreement (the “Agreement”) to sell sixteen properties to American Realty Capital, LLC (“ARC”) in a sale-leaseback transaction. The properties are located throughout Berks, Bucks, Lehigh, Montgomery, Northampton, and Carbon counties. The total sale price is expected to be approximately $38.8 million.

In the Agreement, the parties each make customary representations and warranties to each other. The finalization of the transaction is also contingent upon the completion of a 30 day due diligence period.

The agreement provides that the leases will be institution-quality, triple net leases with initial annual aggregate base rent of $3,003,838 (a 7.75% cap rate) with annual rent escalations equal to the lower of CPI-U (Consumer Price Index for all Urban Consumers) or 2.0 percent commencing in the second year of the lease term. As tenant, the Bank will be fully responsible for all costs associated with the operation, repair and maintenance of the properties during the lease terms.

The agreement provides that each lease will have an initial term ranging from 5 – 15 years, commencing on the closing date for the Agreement, with options to renew on various terms for periods aggregating up to 45 years. The Agreement is expected to close on or before year-end 2007. Sphere: Related Content

Tuesday, November 20, 2007

Whirlpool Signs 10 Year Lease for 1.7 Million SF Distribution Center in CA Inland Empire

Trading Markets - November 19, 2007

Whirlpool Corp. has signed a 10-year lease to occupy the Perris Distribution Center, a 1.7-million-square-foot warehouse-distribution facility at the northeast corner of Perris Boulevard and Morgan Street, said Sam Foster, senior vice president with Jones Lang LaSalle, a Los Angeles real estate firm. Financial terms were not disclosed.

Foster negotiated Whirlpool's lease with the building's developer, IDS Real Estate Group in Los Angeles. The building was the largest speculative warehouse-distribution project ever built in the United States, said Murad Siam, IDS Real Estate's co-chief executive officer.

All of the employees are being moved from two warehouse-distribution facilities in Ontario and one in Mira Loma. Benton Harbor, Mich.-based Whirlpool leased more than 1.5 million square feet of logistics space in those three cities, Foster said.

Whirlpool, which purchased Maytag Corp. for $1.79 billion on March 2006, is building 10 large warehouse-distribution facilities, including the Perris operation, in North America. The Perris facility will serve the southwest United States, Foster said.

Whirlpool officials originally wanted to build their own distribution facility on 80 acres that was served by rail, but changed their plans when such a site became too difficult to find. "It's almost impossible to find a site like that anywhere in the Los Angeles area," Foster said. "We looked in Barstow, but by then Whirlpool decided they would be better off locating in the basin." Sphere: Related Content

Netcare Mulling $5.9 Billion Sale Leaseback of UK & South African Hospital Portfolios?

Business Report - November 20, 2007

Netcare could sell its South African property business, worth R9.5 billion, to unlock more value for shareholders, Richard Friedland, the chief executive, said yesterday.

Friedland said there were at least four or five options the company could explore when the properties were sold. Those included leasing back the hospitals and allowing shareholders to have a stake in Netcare and the property portfolio. Friedland would not be drawn into the time frames of when this could be finalised.

He said there were no discussions taking place around the issue at present, but it was an option the company knew could yield a great deal of value. Netcare manages 56 hospitals in South Africa. It owns 44 of those.

Two months ago, Netcare said it could sell its UK property, which was valued at more than £2.2 billion (R30.2 billion). Peter Nelson, the group's chief financial officer, said those plans were on hold. "We are still open minded to the sale, but the interest rates are very high in the UK right now and we need that to settle down a bit," Nelson said . "At the right time and for the right price we will sell, but it is not our main focus as we stand here today." Sphere: Related Content

The Great Escape Completes $89.5 Million Sale Leaseback of Midwest Store Portfolio

McHenry County Business Journal - November 2, 2007

The Great Escape, the largest home leisure retailer in the Midwest with 21 stores, has sold all of its stores. The Great Escape will continue selling its assortment of home recreational products for the foreseeable future, as the retailer has agreed to a 20 year leaseback of the properties.

This month, South Holland-based Great Escape sold all its store sites, including one at 2421 S. Randall Road in Algonquin, to Scottsdale, Ariz.-based Spirit Finance Corp. for a total of $89.5 million. Records show the Algonquin store sold for $9.8 million.

Representatives of The Great Escape and Spirit Finance Corp. declined to discuss the transaction. Sphere: Related Content

Houghton Mifflin Completes $25.8 Million Sale Leaseback of Chicago Area Warehouse

Cityfeet / - October 25, 2007

Inland Real Estate Exchange Corp., based in Oak Brook, has acquired a distribution center at 1900 S. Batavia Ave. The sales price was $25.8 million. The 513,512-sf building was acquired from Boston-based Houghton Mifflin Co. in a sale-leaseback.

Inland Real Estate Acquisitions Inc. negotiated the sale on behalf of Inland Real Estate Exchange Corp., both of which are affiliates of Inland Real Estate Group of Cos. Inc. Houghton Mifflin was represented in the transaction by Cushman & Wakefield. The cap rate was nearly 7.8%.

The textbook and educational publisher has signed a 12-year lease for the building, which was constructed in the late 1970s with a series of additions in the 1980s and a small addition in the 1990s. The lease rate is $3.90 per sf, net, with escalations each year, says Joe Cosenza, vice chairman of the Inland Real Estate Group of Cos. Houghton Mifflin only has two distribution centers, with the other being in Indiana. The Indiana facility distributes college textbooks while the Geneva facility distributes textbooks for students in elementary and secondary schools, which is the more profitable of the two areas of the company, Cosenza says. Sphere: Related Content

DHL Agrees to €160 Million Sale Leaseback of 26 Logistics Buildings Across France

Segro Web Site - November 15, 2007

Segro has agreed the purchase of a portfolio comprising 26 logistics buildings across France via a sale and leaseback with DHL. The total purchase costs are €159.8m and the portfolio will provide a total annual income of €11.2m representing an attractive net initial yield of 7.0%.

60% of the portfolio is in the Paris region, 10% in Lyon, 12% in Marseille and over 5% in Lille – with the remainder located in Toulouse, Bordeaux, Nantes, Orléans and Strasbourg.

The portfolio totals a built area of c210,000 m² on 70ha of land and comprises distribution and logistics centres used by the DHL Supply Chain and small cross-dock facilities used by DHL Express. All properties will be subject to new, nine year leases with DHL, 20 of them with 6 year break options and 6 of them with 3 year break options

9ha of land has been identified as having immediate development potential and it is estimated that a further 10,000m² of built area can be added in these locations. Sphere: Related Content

Sunday, November 18, 2007

Penn West Petroleum HQ in Calgary Sold for €253 Million

Allianz Global Investors Web Site - November 16, 2007

In a joint venture with Homburg Investment Inc., the property fund company DEGI Deutsche Gesellschaft für Immobilienfonds mbH is making its first investment in Canada. For its DEGI INTERNATIONAL fund, the company acquires an office project featuring a total area of around 57,900 m² for around €253 mln.

The Homburg-Harris Centre.The “Homburg-Harris Centre” will upon completion rank among the most modern and advanced office buildings in the central business district (CBD) of Calgary. The seller of the office project is the international property and project development company Homburg Invest Inc., which as joint venture partner owns a 10 % holding in the newly established property holding company, and will by its Canadian subsidiary be handling local management for the property.

The Homburg-Harris Centre is situated in an extremely central location, Downtown Central Core, with very convenient links to urban public transport. The building complex consists of two linked office towers. The office space of 20,000 m² in the ten-story Tower 1 has already been let in its entirety to the energy company Penn West Petroleum Ltd. before the tower is completed in January 2008. The retailing areas on the ground floor will be used as a restaurant. For the 20-story Tower 2, completion is scheduled for 2009. The Homburg-Harris Centre also features underground parking for 400 cars. The purchase price will be paid in instalments as construction work progresses. Sphere: Related Content

Friday, November 16, 2007

Citigroup Nearing $1.6 Billion Sale Leaseback of Manhattan Office Tower

New York Post - November 14, 2007

Shorenstein Co. is slicing through complicated negotiations to sign a $1.6 billion contract to purchase 388 and 390 Greenwich St. from Citigroup, sources say. As we advised last week, Shorenstein was leading the pack of bidders for what would be one of the largest deals this year. Citi will be leasing back a chunk of the building for the next 15 years.

Shorenstein, which has investments in 125 Park Ave. and the Starrett-Lehigh Building on West 26th Street, declined to comment, as did Cushman & Wakefield's capital markets group, which has been leading the marketing efforts for Citi. Sphere: Related Content

Thursday, November 15, 2007

Cramo Mulls Sale Leaseback of Property Portfolio in Finland

PropertyEU - November 13, 2007

Cramo, a major service provider to the construction industry in Northern Europe, is investigating the possible disposal of its real estate assets in its home country Finland in a sale-and-leaseback transaction during the first half of 2008. In a statement on Tuesday, Cramo said it has given the assignment to Catella Corporate Finance. Cramo will continue as tenant in most of the facilities if a sale is arranged. 'At this stage it is difficult to estimate the profit impact of the possible sale,' Cramo said.

Cramo specialises in construction equipment rental and the sale and leasing of modular space from 260 outlets in 10 countries spread across the Nordic region and Central and Eastern Europe. The equipment hire business has 62 depots in Finland, while its modular hire division operates one office, two factories and 3,500 modules and site huts.

The company is listed on the OMX Nordic Exchange Helsinki and realised a consolidated operating profit of EUR 68.6 mln on sales of EUR 402 mln in 2006. Sphere: Related Content

Sunday, November 11, 2007

Station Casinos Completes $3.1 Billion Sale Leaseback of Four Las Vegas Casinos

Sec Edgar Database - November 7, 2007

On November 7, 2007, Station Casinos, Inc., a Nevada corporation completed its merger with FCP Acquisition Sub, a Nevada corporation, as part of transaction to take the company private.

A number of wholly owned unrestricted direct and indirect subsidiaries of the Company entered into a mortgage loan in the principal amount of $2.050 billion and related mezzanine financings in an aggregate principal amount of $425.0 million (collectively, the “CMBS Loans”), for the purpose of financing the consideration payable to the Company’s stockholders upon consummation of the Merger.

Palace Station, Boulder Station, Sunset Station and Red Rock (collectively, the “CMBS Property”) were sold to the CMBS Borrower. Immediately following such sale, such CMBS Property was leased back to the Company pursuant to a master lease with an initial term of fifteen (15) years and extension terms for an aggregate of ten (10) additional years. The Company in turn subleased each parcel of the CMBS Property back to the Operating Subsidiaries, with each such sublease having the same term as the master lease.

Interest on the CMBS Loans is equal to the LIBOR plus 2.3% per annum. In addition to paying interest on outstanding principal under the CMBS Loans, the CMBS Borrower is required to reimburse the lenders for securitization and disbursement expenses in an amount not to exceed $2,730,000.

The maturity date of the CMBS Loans shall be November 12, 2009, subject to three one-year extensions. The CMBS Loans may be prepaid in whole or in part during the initial two-year term with an initial prepayment fee equal to 1.00% of the principal amount prepaid with the prepayment fee declining after the one year anniversary of the closing date on a straightline basis to 0.0% on the two-year anniversary of the closing date. The CMBS Borrower will be required to hedge the LIBOR interest rate such that it will not exceed 5.5%.

At the commencement of each Renewal Term, if any, Base Rent shall be reset to be equal to the greater of (a) the annual Fair Market Rental for the Leased Property and (b) one hundred ten percent (110%) of the annual aggregate interest payments payable on the then-existing Landlord’s Debt. Tenant shall maintain a reserve (“FF&E Reserve”) for capital and FF&E expenditures in the amount of 2.5% of gross revenues

The CMBS Loans include $740,000,000 for Boulder Station; $1,170,000,000 for the Charleston Station;$471,000,000 for the Palace Station; and $725,000,000 for the Sunset Station. Sphere: Related Content

Saturday, November 10, 2007

S&P Rates C$1.23 Billion in Bonds Financing Canadian Govt Office Portfolio

TD Waterhouse Web Site - October 26, 2007

Standard & Poor's Ratings Services today assigned its preliminary 'AAA' senior secured debt rating to Royal Office Finance LP's C$1.23 billion senior secured amortizing bonds due October 2032.

The preliminary 'AAA' rating assigned to the issue of senior secured bonds by Royal Office Finance LP (ROFLP) reflects the creditworthiness of Public Works and Government Services Canada (PWGSC) and the federal government; the certainty of a rent stream fixed for 25 years; triple net leases with limited setoff and termination rights; bankruptcy-remote sole-purpose special purpose entities ( SPEs) established for the transaction; and a minimum 1x debt service cover through the 25-year term. These strengths are somewhat counterbalanced by the risk associated with refinancing C$425 million at term-end; and a minor amount of appropriation risk.

The bonds are secured by an absolute assignment of rent payments from PWGSC, a ministry of the federal government. Canadian Leaseback LP (CLLP) and ROFLP are formed by Larco Investments Ltd. PWGSC is the ministry of the federal government responsible for providing support to federal ministries and agencies by purchasing goods and services and providing office accommodation and technology services. Larco is a successful privately-owned real estate operator and developer based in British Columbia.

(Note: Private Placement Letter reports that the bonds were bought by 43 Canadian investors at 86 basis points over Canadian Government Treasurys, for a coupon of 5.209%.) Sphere: Related Content

Friday, November 09, 2007

FNV Vastgoed Completes Sale Leaseback of Four Properties in the Netherlands

PropertyEU - November 5, 2007

FNV Vastgoed, the property unit of the largest union confederation in the Netherlands, has divested four offices with a total area of 27,500 m2 via a sale-and-lease-back transaction with UBS Global Asset Management. The financial details were not disclosed.

The offices are located in Amsterdam, Rotterdam, Groningen and Bergen op Zoom. FNV, headquartered in Amsterdam, is leasing back the real estate assets on a long-term basis. Epac Property Counselors advised FNV on the transaction, while UBS Global Asset Management was advised by Cushman & Wakefield. The FNV has 16 affiliated unions representing 1.2 million members. Sphere: Related Content

Thursday, November 08, 2007

FBI Enters $60 Million Build-to-Suit for Regional HQ in Knoxville, TN

Knoxville News Sentinel - November 6, 2007

The FBI has outgrown downtown Knoxville and plans to leave in favor of a new, three-story regional field office in West Knoxville that will cost nearly $60 million.

Last month, a Cleveland, Ohio-area developer purchased 9 acres of land in the Dowell Springs Business Park off Middlebrook Pike that will eventually be home to a 99,130-square-foot office building for the agency.

In addition to employees from the Duncan building, the Dowell Springs office also will be home to employees from the FBI's Joint Terrorism Task Force that is in a West Knoxville office building and counter-intelligence agents in Oak Ridge. Lambert said the building should be finished in March 2009 and will house approximately 150 people.

The building will be developed by Carnegie Management and Development Corp. of Westlake, Ohio. According to a news release from the General Services Administration, the project has a 15-year lease value of $47.4 million.

Robert Berryhill, an executive with Carnegie, said his firm will own the building and the government will lease it for that amount. Berryhill said the total construction cost will be $58 million, and his firm plans to break ground in January. Sphere: Related Content

Bertelsmann Planning £50 Million Sale Leaseback of Publishing Division HQ in London

Estates Gazette has reported that media giant Bertelsmann has hired CB Richard Ellis to offer a 15-year sale leaseback of the 58,500 sq ft London headquarters of its Random House publishing division. The asking price is reportedly £50m which would provide a yield of around 5%. Sphere: Related Content

Wednesday, November 07, 2007

Bendon Seeking $20 Million Sale Leaseback of Auckland HQ

National Business Review - November 5, 2007

Fashion underwear company Bendon's new head office in the Airport Oaks subdivision in Auckland goes on the market as a sale-and-leaseback this week with expectations of a $20 million-plus price tag.

Bendon moved its office from comparatively primitive quarters in the East Tamaki industrial zone when the new headquarters building was completed in 2004. The distribution centre followed early last year.

If the property achieves the anticipated price bracket, it will stamp an international seal of approval on the industrial estates around the airport, with a yield in the low 7 per cent range, firmer than the office market in the central business district was managing two years ago.

The Bendon site occupies 1.64ha and has three road frontages, backing on to Airpark Drive for warehouse access. The head office area of 2167sq m has a rental rate of $250 a square metre and a small part of it a rate of $255. The high-stud 3818sq m section of the warehouse has a rental rate of $110 a sq m. Including a fitout rental for the eight-and-a-half years of the initial Bendon term, total passing rent is just under $1.65 million. Bendon has two six-year rights of renewal. Sphere: Related Content

Sunday, November 04, 2007

Pep Boys Agrees to $166 Million Sale Leaseback of 34 Stores Across US

Philadelphia Inquirer - November 3, 2007

Pep Boys - Manny, Moe and Jack, the Philadelphia automotive repair and parts chain, said yesterday it had agreed to sell and lease back 34 of its 592 retail stores.

The $166.2 million sale will reduce the company's debt, which is $560 million, Harry Yanowitz, chief financial officer, said. He said the properties being sold are at randomly selected locations across the nation.

The sale-and-lease-back program, announced last summer, is part of a turnaround strategy that began with the appointment in March of chief executive officer Jeffrey C. Rachor, 45. The chain, with locations in 36 states and $2.3 billion in annual revenue, has lost money in three of the last five years. Since June, its shares have fallen from a 52-week high of $22.49 to as low as $12.48.

The company was founded in 1921 in West Philadelphia. It grew rapidly, aided by Henry Ford's sale of Model T's without such essentials as headlamps - an effort by Ford to create an aftermarket industry that would promote and support automobiles. Two years after opening the Philadelphia store, two of the founders, Manny Rosenfeld and Moe Strauss, took a research trip in a Model T to Los Angeles, where they began acquiring properties. The company today owns properties, on both coasts and in major cities, that have increased greatly in value. It is seeking to convert that to cash to reduce its debt and fund change and growth.

When the pending deal closes later this month, the company will begin work on another batch of store sales. As a store is sold, it will be leased back for 15 years, with four five-year renewal options, Yanowitz said. No decision has been made on how many stores to sell or how far to reduce debt, Yanowitz said. Sphere: Related Content

Deutsche Woolworth Agrees to EUR 400 Million Sale Leaseback of 100 Stores in Germany

Trade News / Financial Times Deutschland - November 2, 2007

Argyll Partners, the UK investment firm, is acquiring Deutsche Woolworth, the German low-cost retailer, and intends to pass the outlets which the retailer actually owns, numbering around 100 and valued at around 400m euros in the 2005 balance sheet, to the US investment firm Cerberus, according to company sources. A sale-and-lease-back is reported to have been decided for several of the properties. The seller of the German company is the UK investment firm Electra.

Argyll has indicated that the sale will finance the restructuring of Deutsche Woolworth, through which a strengthening of operative business and a return to profitability are targeted. The German retailer, which operates around 340 branches in Germany and Austria, generated turnover of 1bn euros in 2005. Sector experts have expressed surprise that the operative business is being taken over alongside the property which, until now, has been regarded as the only valuable asset of the German business. Sphere: Related Content

Saturday, November 03, 2007

Neurocrine Biosciences Enters $108 Million Sale Leaseback of San Diego HQ

Neurocrine Biosciences Web Site - November 1, 2007

Neurocrine Biosciences, Inc. (Nasdaq: NBIX) announced today that the Company has entered into a sale and leaseback agreement with Veralliance Properties for its real estate assets, with an expected closing date before year-end 2007. Total consideration to be received by Neurocrine for the properties is $108 million. Concurrently with the closing of the transaction, Neurocrine will lease back its corporate headquarters under a lease with a 10 year term. Neurocrine has certain options to repurchase all of the properties included in the transaction during the term of the lease. Under the terms of the asset purchase agreement, Neurocrine anticipates that it will receive cash of approximately $60 million net of fees, expenses and existing indebtedness.

"Owning the properties that Neurocrine occupies has been a highly profitable strategy for the Company and our shareholders, allowing us to benefit from the appreciation in the San Diego commercial real estate market," said Timothy P. Coughlin, Vice President and Chief Financial Officer of Neurocrine Biosciences. "Improving our strong financial position at this time in a non-dilutive manner provides us with the financial flexibility to advance our clinical and research programs and build equity in our pipeline."

Neurocrine Biosciences, Inc. is a product-based biopharmaceutical company focused on neurological and endocrine diseases and disorders. The product candidates address some of the largest pharmaceutical markets in the world including insomnia, anxiety, depression, endometriosis, irritable bowel syndrome, pain, and diabetes.

(NOTE: According to the just released 10-Q report, the property was sold at a 7.0% cap rate with 3% annual rental increases, subject to a 10 year net lease with landlord roof & structure risk. The purchase option is at the greater of market or the then escallated base rent capped at 6.75%.) Sphere: Related Content

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