Pace University Enters Build-to-Suit for Student Housing in Manhattan

Reuters - December 30, 2010

Israel's Harel Insurance Investments & Financial Services (HARL.TA) said on Thursday it was teaming up with U.S. real estate partners for a project in New York, as it expands its property portfolio abroad.

Harel, U.S. office space owner SLG Green Realty (SLG.N) and real estate developer Jeff Sutton aim to build a $58 million complex in lower Manhattan's financial district.

The 23-storey building at 180-182 Broadway is slated to be completed in 2014, Harel said. Harel said its stake in the project is 49 percent and it will invest $28.5 million. The building will be used mainly to house students at Pace University and will be rented to the university for 30 years.

In October, Harel acquired two office buildings in Houston, Texas with Beacon Investment Properties for $85.2 million. Sphere: Related Content

DTS Completes EUR 80 Million Sale Leaseback of Madrid HQ

Property Week - December 29, 2010

CB Richard Ellis has completed the €80m (£68m) sale and leaseback of the headquarters of the largest provider of digital pay television in Spain, Distribuidora de Television Digital S.A.U. (DTS).

CPA®:17 – Global, an affiliate of WP Carey, the global investment management company that provides long-term sale and leaseback and build-to-suit financing, acquired the building. DTS will remain as tenants for a period of 20 years.

DTS’s 441,320 sq ft headquarters in Madrid is located in Tres Cantos and was constructed in 2008. The building comprises both office and television production space.

Adolfo Ramirez-Escudero, executive managing director of Capital Markets at CB Richard Ellis Spain, said: “Despite a difficult year for the investment and financing of real estate in Spain, this transaction confirms institutional investors’ interest in these kinds of deals in the Spanish market and is a reminder of the special place that sale and leasebacks hold in Spain.

“The banks have sold over €8.5bn of property via sale and leaseback in the last three years in Spain, of which CBRE has advised on almost €5bn. WP Carey had been out of the Spanish market over the past 10 years but decided to return last year and is now very active. We will see more sale and leasebacks from corporates, just as we saw Eroski, Mercedes-Benz and FCC active this year.”

DTS is a subsidiary of Promotora de Informaciones S.A. (PRISA) and operates the group’s pay TV production and distribution activities.

CBRE also advised PRISA in 2008 on the sale and leaseback of its headquarters in Madrid; the editorial office of El País; and Cadena Ser’s headquarters in Barcelona. The assets were sold to Drago Real Estate for €315m. Sphere: Related Content

Mercedes-Benz Spain Agrees to Sale Leaseback of HQ in Alcobendas

CincoDias.com (as translated in Google) - December 27, 2010

The Spanish subsidiary of German carmaker Daimler, Mercedes-Benz Spain, has reached an agreement with a subsidiary business of the insurer Mapfre life to sell its headquarters in Spain, located in the town of Alcobendas (north of Madrid) and shall leased for a minimum period of ten years, extendable to 20 years.

According to the company, the sale and leaseback agreement was closed on the basis of parameters of return of 6% and allows the firm to sell goods from his property to "immediately afterwards" rent for a period of time. The companies did not provide financial details of the operation.

Following the signing of this agreement, President and CEO of Mercedes-Benz Spain, José Luis López-Schumm, said in a press release with this real estate deal his company "follows the Daimler group's business strategy, which seeks progressive transformation in their rented office facilities and property of their factories, commercial outlets and mixed use.

"In this context," said the manager, "Daimler decisively bet for our country, as shown by, among others, the recent investments in expanding After Sales Logistics Center in Miralcampo (Guadalajara), the adaptation of the Vitoria plant for the mass production of electric version of the Vito van, and the creation of Shared Service Centre Accounting and Finance, Daimler to Western Europe in Madrid, "he added.
The firm noted that Daimler started this business strategy in 2006 with the sale of its headquarters in Stuttgart (Germany) to the British firm IXIS Capital Partners, to move to its lease for a period of 15 years. The procedure of sale and leaseback has been chosen by other group companies like Santander and Grupo Prisa, publisher of CincoDías. Sphere: Related Content

Medica Completes EUR 130 Million Sale Leaseback of 19 Care Facilities in France

Medica Website - December 20, 2010

MEDICA, a leading provider of long and short-term dependency care in France, announced today the sale and leaseback of a portion of its property assets.

The new finance lease was signed on 17 December 2010 under a club deal with Natixis Bail, a wholly-owned subsidiary of Natixis, and Finamur, a wholly-owned subsidiary of Credit Agricole Leasing (co-leads) and Oseo Financement. Its main terms are as follows:
- Amount: €130 million
- Term: 12 years
- Rate: 3-month Euribor 120 bps

The lease has enabled MEDICA to diversify and optimise the terms of its financing by setting up a long-term property loan. The transaction, which was made possible by the quality of the underlying properties, also allows MEDICA to maintain control over its assets due to the purchase option exercisable at a future date.

The transaction covers 19 facilities with a total of some 1,400 beds. Sphere: Related Content

Carquest Completes $258 Million Sale Leaseback of 29 Distribution Centers and Four Office Buildings

Citybizlist New York - December 22, 2010

Corporate Property Associates 17 - Global Inc., one of the publicly owned, non-traded real estate investment trusts (REIT) of W. P. Carey, has completed a $258 million acquisition of 29 automotive equipment distribution centers and four office buildings totaling 3,572,684 square feet.

The real estate investment trust has also entered into a total of four net lease agreements, two with Carquest Canada Ltd. and two with General Parts Inc. The tenants are affiliates of General Parts International, Inc., doing business as CARQUEST Auto Parts.

CARQUEST has guaranteed the obligations of the tenants under the leases.

The total cost of the purchase, including acquisition and transaction costs, was approximately $258 million. Three of the four leases have an initial term of 20 years and each provides for six five-year renewal options. The remaining lease has a term of five years. Additionally, each of the three 20-year term leases provides for stated rent increases every five years.

In connection with the acquisition of 30 of the distribution centers and office buildings, the Company obtained a 10-year, non-recourse mortgage financing of approximately $117 million bearing interest at a fixed rate of 5.17% per year.

At September 30, 2010, Corporate Property Associates 17 - Global Inc.'s portfolio was comprised of a full or partial ownership interest in 91 fully occupied properties, substantially all of which were triple-net leased to 27 tenants, and totaled approximately 10 million square feet. Sphere: Related Content

Banca MPS Trust to Issue EUR 1.54 Billion in Lease-Backed Notes Secured by 683 Bank Branches and Offices in Italy

TD Waterhouse/Fitch Research - December 23, 2010

Fitch Ratings has assigned Casaforte S.r.l.'s EUR1,536.64m class A notes, due June 2040, a final 'A-sf' rating with Stable Outlook. The final rating addresses the timely payment of interest and ultimate repayment of principal. Fitch gave consideration to the legal and financial structures in assigning the final rating to the issue.

The transaction is a securitisation of rental income derived from 683 bank branches and offices in Italy. These real estate assets are let to Banca MPS ('A-'/Stable/'F2') and its subsidiaries until July 2033.

The class A notes are scheduled to fully amortise by their expected maturity date in December 2030. Banca MPS is responsible for about 86.5% of the initial rental payment. The remaining portion is paid by Banca MPS's subsidiaries, but Banca MPS is also jointly and severally liable for these obligations (if the relevant subsidiary does not make any payment or there is any payment shortfall).

Consequently, the final rating is fully credit-linked to Banca MPS's rating. Any change in Banca MPS's Long-term Issuer Default Rating is likely to result in a corresponding change in the rating of the notes. The transaction has an initial class A-to-portfolio value ratio of 89% and an initial class A-to-vacant possession value ratio of 107%, although these ratios are scheduled to amortise to zero by the class A expected maturity in December 2030. Sphere: Related Content

Enterprise Inns to Pursue Sale Leaseback of 27 UK Pubs in 2011

The Publican - December 22, 2010

Enterprise Inns is believed to be preparing to sell off the freehold interest in 27 pubs, possibly as part of its ongoing sale and leaseback programme.

One of the pubs understood to be up for sale in the New Year is the Eagle Ale House in Battersea, South London, which is run by Simon Clarke, a leading light in the Fair Pint movement.

The UK’s largest leased pub company sold the freeholds to 71 pubs in its last financial year, renting back the pubs on new, 35 year leases. When it announced its full year results in November it said it planned to do a similar number of deals in 2010/11.

Proceeds from last year’s sales came in at £114m, achieving an overall rental yield of 6.4 per cent. Earlier this month it sold the freeholds of a further 11 pubs for £13m.

The freeholds are sold through auctioneers, generally Allsop but also another firm, Cushman & Wakefield. Both are hosting auctions early in the New Year. Industry observers also suggest the 27 pubs might be on the block as a single package deal. Sphere: Related Content

NH Hotels Seeking EUR 200 Million Sale Leaseback of Six Hotels in Spain

Bloomberg - December 21, 2010

Hesperia, the largest shareholder in NH Hotels SA, plans to sell six hotels in Spain in a sale and leaseback agreement for 200 million euros ($263 million) to reduce debt, Expansion reported.

Hesperia hired Spanish real estate consultant Aguirre Newman to advise on the sale, the newspaper said.

The company hopes the sale will produce a capital gain of 43 million euros that can be used to repay part of Hesperia’s 602 million euros debt, the newspaper added, citing unidentified people. Sphere: Related Content

Banco Sabadell Bank Branch Portfolio Sold for EUR 55 Million

Private Equity Real Estate - December 20, 2010

Moor Park Capital, the London-based asset management and investment firm, has sold a package of 48 local bank branches in Spain to the private investment house of Armancio Ortega, the founder of the eponymous Inditex fashion chain.

In a statement issued today, it emerged ISC Freshwater Investments, which is an investment vehicle advised by Moor Park, has sold the prime branches for €55 million to Pontegadea Group.

The sale underlines the break-up strategy that investments firms are pursuing in Spain once they acquire multiple units in large sale and leaseback transactions with savings banks in the country.

Moor Park and a consortium of investors reported to include New York’s Och-Ziff Capital Management, bought 378 branches for €403 million in April this year from Banco Sabadell in a sale and leaseback deal. The bank agreed to a minimum rental term of 25 years across the properties. The subsequent sale comprises five large retail banking units situated in well-established retail locations in different Spanish major cities including Barcelona and Madrid.

Cushman & Wakefield and Aguirre Newman are exclusive selling agents across the whole portfolio. The former of the two agents said in a statement it received many inquiries from interested buyers so it decided to sell a small selection of individual assets from the portfolio. To date around €65 million of properties have been sold in total.

The buyer is the private property company of the founder of Inditex, Armancio Ortego, whose best-known high street chain is Zara.

Shares in Inditex have risen around 32 percent since the start of the year, giving the Ortega family a corresponding increase in paper wealth. Sphere: Related Content

HCP Acquires ManorCare in $6.1 Billion Sale Leaseback of 338 Senior Care Facilities

The Toledo Blade - December 15, 2010

Toledo's largest privately held company has sold off its real estate to a California company and will lease it back as part of what amounts to a $6.1 billion refinancing of the deal that originally made HCR ManorCare a private firm three years ago.

Neither the day-to-day operations of ManorCare, which is owned by the Carlyle Group and headquartered in downtown Toledo, nor its approximately 60,000 employees will be affected by the transaction with HCP Inc., a real estate investment trust based in Long Beach, Calif., ManorCare spokesman Rick Rump said. The company also will remain a large part of the Toledo skyline for the foreseeable future, he said.

HCP will pay $3.53 billion in cash and $852 million in stock for the properties. It can issue 25.7 million shares or a cash equivalent. The deal includes $1.72 billion in funds HCP previously invested in ManorCare. HCP, the largest medical real estate investment trust (REIT) in the U.S., will have an option to buy a 9.9 percent stake in ManorCare for another $95 million.

"This needs to be looked at as a refinancing," Mr. Rump said. "When we took the company private in 2007, [the transaction] was backed by mortgage-backed securities. We are exchanging those for a sale-leaseback arrangement." (Note: Morningstar states that the assets will be triple-net leased to HCR Manorcare at a 7.9% initial capitalization rate with 3%-3.5% contractual annual rent escalators.)

Mr. Rump said ManorCare had become "the lone holdout" in its industry to still own its own real estate holdings. He said inside the company's 338 facilities across 30 states, ManorCare "will still have all the responsibilities it has always had. We will just be leasing these facilities instead of owning them, as we have in the past."

HCR ManorCare, which was purchased for $6.3 billion in 2007 by the Carlyle Group, a private equity firm based in Washington, has 338 facilities that provide postacute care, skilled nursing services, and assisted living facilities in 30 states. The company is centered around 275 skilled nursing and rehabilitation centers, and about 50 facilities that provide care for Alzheimer's and dementia patients, with many of its properties concentrated in Ohio, Pennsylvania, Florida, and Michigan.

The purchase by HCP will expand the California trust's portfolio to nearly 1,000 properties, which it says are worth $19 billion in total. HCP already runs 250 senior housing properties and 45 skilled nursing facilities.


Morgan Keegan analyst Robert Mains said HCP "has long indicated an interest in investing in premier nursing home assets," and described ManorCare as the top nursing home operator in the United States.

HCP took out a bridge loan worth up to $3.3 billion to complete the deal, and it will issue debt and 31 million shares of common stock in lieu of borrowings. The underwriters will have an option to buy another 4.7 million shares in the next 30 days to cover any over allotments.

The companies said they expect the deal, which needs regulatory approvals, to close late in the first quarter of 2011. The deal already had been approved by shareholders of both HCP and ManorCare.

HCP officials said Paul Ormond, ManorCare's president, chairman, and chief executive officer, will be invited to join the HCP board.

In a statement, Mr. Ormond said, "We at HCR are delighted to have the opportunity to help secure the future of HCR ManorCare's operations by partnering with HCP. Going forward, our company leadership remains the same, we will continue our high level of investment in training and facilities, and our employees will continue to provide the same high-quality care that our patients and residents expect." Sphere: Related Content

SuperAmerica Completes $248 Million Sale Leaseback 135 Convenience Store Service Stations in Minnesota and Wisconsin

CoStar Group - December 15, 2010

Realty Income Corp. completed the acquisition of 135 SuperAmerica convenience stores and one support facility for $248 million under long-term, triple-net lease agreements.

These, and certain other assets, were sold by Marathon Oil and will be leased to newly formed companies owned and operated by Northern Tier Energy, a portfolio company of ACON Investments and TPG Capital.

Realty Income acquired the 136 SuperAmerica properties under 15-year, triple-net lease agreements.

The stores are in Minnesota and Wisconsin, and average 3,500 leasable square feet on 1.14 acres.

In addition, the individual locations have, on average, 6.5 multi-pump gasoline dispensers, and are seasoned stores with long term operating histories. The stores are operationally strong with gallons sold and merchandise sales well above national averages, and strong cash-flow coverage of rent at the store levels.

With this acquisition, the company anticipates that the convenience store industry will now generate 20% of Realty Income's revenue going forward.

Including the SuperAmerica transaction, and other properties to be acquired in the fourth quarter, we now anticipate that acquisition activity should exceed $700 million for 2010," said Tom A. Lewis, CEO of Realty Income. "These acquisitions should contribute to the continued stable stream of lease revenue from which we pay monthly dividends." Sphere: Related Content

London HQ of Allen & Overy Sold for $882 Million

The Telegraph - December 16, 2010

The biggest office deal in the City this year has been completed after two JP Morgan funds agreed to buy Bishops Square for £557m.

The 825,000 sq ft property is the headquarters of law firm Allen & Overy and is located next to Spitalfields Market.

The deal highlights the scale of investor demand for property in the Square Mile, which has led to the capital values of commercial property recovering sharply since last summer.

Bishops Square is being sold by Hammerson, the FTSE 100 property company, and the Oman Investment Fund (OIF), who operated a 25:75 joint venture. Oman only acquired its stake last June in a deal that valued the property at £445m. Wednesday's sale represents a 25pc increase on that price and a gain on the £510m book value of the asset at June 30. The price reflects a yield of 6.2pc.

Peter Reilly, head of JP Morgan Asset Management's European real estate group, said: "We remain bullish on investing in high-quality, well-tenanted office properties located throughout Europe's most important cities and this acquisition represents a further expansion of our funds' core property portfolio in Europe."

Hammerson completed the office development in 2005 as part of the regeneration of the Spitalfields area.

David Atkins, chief executive, said: "We are capitalising on the market recovery over the past 15 months and Hammerson has released funds for investment into other office and retail developments and acquisitions."

OIF, traditionally a long-term holder of assets, said it sold the property because it is prepared to "adapt to market dynamics in an efficient manner to bring value to our shareholders". Sphere: Related Content

YTL Agrees to $153 Million Sale Leaseback of Four Hotels in Japan and Kuala Lumpur

Business Times - December 15, 2010

YTL Corp Bhd is selling four properties to Starhill Real Estate Investment Trust (REIT) for RM472 million and leasing them back.

The properties are Cameron Highlands Resort, Hilton Niseko in Japan, Vistana Penang and Vistana Kuala Lumpur, the group said yesterday.

Apart from RM100 million cash payment, Starhill Global Real Estate Investment Trust will also issue convertible preference units at S$1 (S$1 = RM2.40) per unit.

Upon conversion of convertible preference units into Starhill Global REIT, YTL Corp's stake in the Singapore exchange-listed REIT will increase. Sphere: Related Content

Capital Automotive Preps $463.3 Million Lease-Backed Financing of 78 Auto Dealerships

TD Waterhouse/Thomson Reuters IFR - December 6, 2010

Last week, Credit Suisse (structurer), Barclays, and Goldman Sachs announced the US$463.3m CARS-DB4 Net-Lease Mortgage Notes Series 2010-1, which is backed by 78 commercial real estate properties (primarily automobile dealerships) including related rents according to triple-net leases.

The issuer is privately held McLean, Va.-based Capital Automotive LLC (CARS), which invests in real estate properties leased to franchised auto dealerships and other auto-related businesses.

CARS is owned by funds managed by DRA Advisors LLC, a real estate investment advisor based in New York. As of Sept. 30, 2010, CARS had roughly US$3.6bn invested in 358 properties with approximately 491 motor vehicle franchises representing 45 brands in 36 states and Ontario, Canada.

Price guidance on the offering came out this afternoon. The US$432.3m, Class A, 'A' rated tranche is expected to price in the mid-5% yield area. The 'BBB' rated, US$31m Class B piece will be retained.

According to S&P, CARS acquires retail automotive properties and improvements from dealer groups, such as AutoNation and Group 1 Automotive.

Through sale-leaseback transactions, a dealer group sells its real estate to CARS and leases the property back under a long-term, triple-net lease. Under a triple-net lease, the tenant is required to pay all property-level expenses including business expenses, real estate taxes, utilities, insurance, repairs, and maintenance.

Leases with a dealer group are cross-collateralized to ensure that the full strength of the dealer group supports each lease.

The offering has an appraised value of US$617.775m, and the Class A notes are 70% of the appraised value. The leases feature a diverse group of obligors, and 52.9% of the tenants are in the top 10 US dealer groups; 54.5% of tenants are publicly traded companies.

S&P says that the risks to the cashflows of the deal depend on four major factors: defaults by the initial pool of dealer groups (the lessees); the ability of the property manager to re-lease the properties vacated by defaulted lessees to new tenants, and the renewal rate of lessees who reach the end of their lease; the lease terms for new tenants (rental rate and term of lease); and the liquidation value of those properties where the manager is unable to re-lease and chooses to liquidate.

The rating agency used its CDO Evaluator model, the S&P ratings of the lessees (or 'CCC-" for unrated lessees), the present value of future lease payments, and the current lease expiration to determine the initial default rate of the initial pool of lessees. Sphere: Related Content

CoStar Group Seeking Sale Leaseback of Washington, DC HQ

Washington Business Journal - December 6, 2010

CoStar Group Inc., the publicly traded firm known for its real estate data tracking, is continuing to prove that it can be quite the aggressive dealmaker itself.

Just 10 months after buying the former Mortgage Bankers Association headquarters at 1331 L St. NW for its new D.C. headquarters for just $41.25 million — compared with the $76 million the mortgage bankers group paid in 2008— CoStar has put the building back on the market.

Cassidy Turley is marketing the 169,429-square-foot building for sale. Its marketing materials bill the project as fully leased.

At the time of the acquisition, CoStar CEO Andy Florance estimated that buying its headquarters building would save about $1 million a year compared with leasing. But now, putting the property back on the market suggests the company sees an even greater financial opportunity from cashing in on the District’s hot investment sales market.

CoStar would stay in 88 percent of the building under an escalating triple-net lease that runs through 2025.

CoStar moved its headquarters to D.C. from Bethesda, lured by a $6.1 million, 10-year tax abatement passed by the D.C. Council in January, if it hires 100 D.C. residents, among other criteria. Sphere: Related Content

JP Morgan HQ in London Offered for Sale

The Telegraph - December 6, 2010

The company has appointed GM Real Estate to advise on the sale of Alban Gate, one of the City's most recognisable office buildings.

The 382,000 sq ft asset was only acquired by Carlyle in July as part of a £671m deal for the White Tower portfolio, a collection of London offices previously owned by bankrupt tycoon Simon Halabi.

The sale is seen as an opportunity to raise capital to invest in other White Tower offices, where there are significant redevelopment opportunities.

Alban Gate is the biggest asset in the portfolio and its long-term income stream is likely to be attractive to investors. Its annual rent is £18.2m and JP Morgan's lease runs until 2025.

Carlyle is understood to believe it can raise more than £300m from a sale. A £300m price would represent a yield of 6pc. The private equity group acquired the White Tower portfolio at a 9pc yield.

Alban Gate was snapped up by Carlyle after Mr Halabi, once regarded as one of the UK's wealthiest entrepreneurs, lost control of his empire.

His collection of nine London office buildings tumbled in value from £1.8bn in 2006 to £929m last June. The offices were backed by £1.15bn of bonds issued by the White Tower 2006-3 vehicle, and the decline in value caused a breach of loan-to-value covenants.

This prompted bondholders to call in the debt, with property agents CBRE and Knight Frank overseeing a disposal of the assets in order to raise funds to repay bondholders.

Carlyle acquired six of the properties, including Alban Gate and offices housing UBS and IBM. Aviva Tower, home of the insurer in London, is still in the hands of the loan servicer, but it is understood to be preparing a sale for the first half of next year.

Carlyle declined to comment. Sphere: Related Content

CVS Trust to Issue $338.1 Million in Lease-Backed Notes Secured by 77 Drug Stores in 28 States

Providence Business News - December 2, 2010

CVS Caremark Corp., the largest provider of prescription drugs in the U.S., sold $338.1 million of debt secured by mortgages and leases, raising capital through the sale leaseback market.

The securities due in January 2033 yield 287.5 basis points more than 10-year Treasuries, according to data compiled by Bloomberg.

Sale leasebacks involve property being simultaneously sold and leased back to the seller for long-term continued use. The arrangement allows CVS Caremark to “essentially monetize our real estate asset,” Chief Financial Officer David Denton said Nov. 16 at a conference.

Buyers of the pass-through certificates will receive monthly payments of 5.773 percent, backed by the leases. Proceeds help CVS finance new store development, according to the company’s most recent quarterly filing.

The company gained $124 million from sale leaseback transactions in the nine months ended Sept. 30, compared with $748 million in the year-earlier period, according to the filing. The market was inaccessible in the fourth quarter of 2008 as credit markets froze.

Barclays Capital managed the sale. Sphere: Related Content

Deutsche Bank Weighs Sale Leaseback of Frankfurt HQ

Bloomberg - December 2, 2010

Deutsche Bank AG, Germany’s largest bank, may sell its Frankfurt base as investor demand for office space increases in the country’s financial center.

The company “is deliberating over the question if real estate should be kept in proprietary possession or should be used via a sale-and-lease-back,” according to an e-mailed statement today.

Deutsche Bank bought the two 36-story glass towers, known as Soll und Haben, or Debit and Credit, from one of its real estate funds for 272 million euros ($359 million) in 2007. The bank spent three years renovating the buildings to make them more environmentally friendly and has started the process of moving 2,800 people back in over the next three months.

Demand for Frankfurt office space is rising as the German economy rebounds from the global financial crisis, prompting the most investment in the city since 2007. It may reach 2 billion euros this year, according to CB Richard Ellis Group Inc., the world’s largest property adviser.

Deutsche Bank may sell the Frankfurt building for 500 million euros, Financial Times Deutschland reported today, citing unidentified people familiar with the situation.

Banco Santander SA, Spain’s biggest banks, and HSBC Holdings Plc, Europe’s largest bank by market value, both sold their head offices and leased them back in the past two years. Sphere: Related Content

Scottish and Southern Energy Nearing Sale Leaseback of Glasgow HQ

The Herald - November 27, 2010

Scottish and Southern Energy is set to rake in at least £10 million by quickly offloading the Central Belt headquarters that it bought in Glasgow last month.

According to well-placed sources, the Perth-based energy giant is close to selling the nine-storey One Waterloo Street building in a 35-year sale and leaseback deal to Prupim, the investment vehicle of pension group Prudential.

Having originally paid somewhere north of £20m for the beachhead deep in Scottish Power territory in early October – which was seen as a knock-down price at the time – SSE is poised to significantly increase the value by committing itself as a long-term tenant.

Although SSE’s rental costs over the duration of the lease are very likely to exceed any windfall a deal will free up a substantial amount of capital for investments.

SSE has been an aggressive investor in renewable technologies as it seeks to maximise its earnings from the renewable obligation system of UK green energy subsidies in the coming years. It invested £3m in Edinburgh-based wave energy pioneer Aquamarine Power earlier this week. Other recent investments included buying an £8m 15% stake in April in Burntisland Fabrication, which has become a world leader in foundations for offshore wind turbines.

Property watchers were impressed by the speed at which SSE concluded the two deals, particularly compared to the many months that Scottish Power has spent weighing up whether to take a new large office space near the city.

One source said: “SSE bought it cheap and then quickly sold on the investment. They’re good operators.”

One Waterloo Street, which SSE bought from Australia’s Halladale Group, is to be used by the group primarily for its renewable energy activities. It is in the course of investing many billions into the sector, particularly onshore and offshore wind farms but also hydroelectricity, biomass and marine energy.

The city is also to be the location for SSE’s Centre of Energy Excellence for Renewable Energy, a joint venture with Strathclyde University that has received £2.8m of funding from the Scottish Government.

One Waterloo Street overlooks Glasgow Central Station and sits on the former site of Shaftesbury House. Its 60,000sqft of space could accommodate around 600 employees. SSE sublets some of the space to property agency CB Richard Ellis, which is set to remain there. SSE itself is due to start moving in staff members in the New Year, and is said to be planning an official opening around that time. Sphere: Related Content

Caja Madrid Closes EUR 96 Million Sale Leaseback of 97 Bank Branches in Spain

PropertyEU - November 23, 2010

Madrid-based investment firm Drago Capital and an affiliate of Cerberus Capital Management have acquired a real estate portfolio consisting of 97 bank branches from Caja Madrid. The sale-and-leaseback transaction amounts to EUR 96 mln, representing an EUR 80 mln capital gain for the Spanish lender.

Caja Madrid, Spain's fourth largest bank, said the sale will boost its finances while helping decrease its loan to value, one of its strategic objectives. The bank has agreed to take a 25-year lease on the properties. The financing for the transaction is being provided by Banco Santander, La Caixa and Natixis.

'Reaching a mutually beneficial agreement for the acquisition of this high-quality real estate portfolio is a gratifying achievement. In addition, we are pleased to have Cerberus, one of the world's leading private investment firms, as a partner in this transaction, and we hope to partner with them on additional investments in Spain in the future," a Drago spokesperson said.

Cushman & Wakefield was responsible for the valuation of the branches. Gómez-Acebo & Pombo and Ashurst served as legal advisers to Drago and Cerberus. Linklaters advised the financing banks.

In May 2010, Caja Madrid sold a technology complex at Las Rozas in Madrid to SEB ImmoPortfolio Target Return Fund for EUR 108 mln. Sphere: Related Content

Sonae Completes EUR 71 Million Sale Leaseback of Six Stores in Portugal

Sonae Website - November 18, 2010

Sonae informs that, since the last announcement made on 20 May, Sonae RP has concluded further sale & leaseback transactions for a total consideration of 71 million euros generating an aggregate book gain of 29 million euros. The blended average initial yield on these transactions was 6.8% on a ‘Triple Net’ (1) basis.

The third quarter accounts of Sonae reflect a book gain of 3 million euros, resulting from the sale and leaseback of 2 Modelo stores, for a total consideration of 18 million euros, and the promissory agreement to complete the sale and leaseback of a further Modelo store by end March 2011, with a prepayment of 2 million euros.

The fourth quarter accounts of Sonae will reflect the sale and leaseback of 2 Modelo stores and 3 stores within Leiria Shopping (Continente, SportZone and Worten), for a total consideration of 44 million euros, and assuming the completion of the above mentioned promissory agreement of a Modelo store, a consideration of an additional 7 million euros.

These transactions will generate an estimated book gain amounting to 26 million euros. These transactions are consistent with the announced strategy to release capital from Sonae RP’s retail real estate assets, while maintaing adequated operational flexibility. Sphere: Related Content

A&P Agrees to $89.8 Million Sale Leaseback of Six Grocery Stores in Four States

The Great Atlantic and Pacific Tea Company Website - November 9, 2010

The Great Atlantic & Pacific Tea Company, Inc. (A&P), (NYSE: GAP) today announced that on November 4, 2010 the Company entered into an agreement with Winstanley Enterprises, LLC and certain of its affiliated entities (Winstanley) to sell six of its retail locations for $89.8 million, exclusive of closing costs.

Winstanley agreed to purchase 100% of the Company's interest in six Pathmark retail properties comprising approximately 329,000 square feet, located in New York, New Jersey, Pennsylvania and Delaware. The properties are 95% occupied and leased to A&P.

"This agreement is another step forward in our comprehensive turnaround strategy. We continue to analyze areas across the business to identify ways such as these to further strengthen our financial foundation and improve our performance," said Sam Martin, President and CEO, A&P.

The sale-leaseback transaction with respect to five of the six properties was closed today, and the transaction with respect to the sixth property is expected to close later this week. Sphere: Related Content

Banca Monte dei Paschi di Siena SpA Agrees to Sale Leaseback of 683 Italian Bank Branches

Bloomberg - November 8, 2010

Banca Monte dei Paschi di Siena SpA, the world’s oldest bank, is selling about 1.5 billion euros ($2.1 billion) of bonds bundling a loan on office properties.

Monte dei Paschi will offer the 20-year securities to its retail clients over the next six weeks, said a spokeswoman at the Siena-based lender, who declined to be identified under company policy. It plans to offer 130 million euros of mezzanine bonds to institutional investors, she said.

The transaction through Casaforte S.r.l. is backed by a commercial mortgage used by investors including Axa Assicurazion to buy 683 properties from Monte dei Paschi, Fitch Ratings said in a Nov. 5 report. The mortgage holder has agreed to pay interest and principal twice a year until 2030, Fitch said.

The notes are backed by a stream of interest and principal from the property loan throughout their life, instead of the standard structure where payment on the property loans is collected in a lump sum at maturity, said Giovanni Pini, a London-based analyst at BNP Paribas SA in London.

“The transaction is indicative of future possible deals,” Pini said. “Refinancing, which is the main issue of existing CMBS transactions, shouldn’t be a problem in this case.”

Just 10 of 48 European commercial mortgages maturing during the first eight months of the year were fully repaid at their due date, according to Standard & Poor’s data. Twenty-seven loans are in default or standstill, and nine have been extended.

The notes will pay a half-yearly coupon of 3 percent until 2012 and a floating rate of 1.05 percent more than the six-month euro interbank offered rate, or euribor, thereafter, according to a statement distributed by the Italian stock exchange. Sphere: Related Content

Adidas' Seeking $90 Million Sale Leaseback of Portland HQ

Portland Business Journal - October 29, 2010

Adidas America Inc. has put its North Portland headquarters up for sale.

The company is looking for a buyer that will lease the eight-year-old, 320,000-square-foot campus back to it for 10 years, according to a flyer announcing the property’s availability.

"There are several business and financial reasons we are considering a sale-leaseback transaction, the most important being that it would free up funds which we can reinvest in our brand, employees and community in which we operate," said spokeswoman Lauren Lamkin, in an e-mail. "Adidas remains committed to continuing our strong local presence in Portland.”

Officials with the Seattle office of Jones Lang LaSalle Americas Inc., the real estate services firm offering the property, could not be reached for comment.
The campus, which includes five office buildings and an athletic facility, has a market value of nearly $88.8 million, according to Multnomah County property tax records.

According to the flyer, Adidas would pay $15 per square foot in rent, including 2 percent annual escalators, providing the eventual buyer with first-year operating income of $4.8 million.

Adidas bought the site of Beth Kaiser hospital at 5055 N. Greeley Ave. in 1999.

The $90 million development opened in 2002, allowing the company to consolidate its offices in Northeast Portland and Beaverton. Sphere: Related Content

AOL Sells Portion of Campus Leased to Raytheon Near DC for $144.5 Million

Commercial Property Executive - October 29, 2010

AOL Inc. has decided to forgo steady income stream from four fully leased office buildings at its campus in Dulles, Virginia, for cash up front. The online services company has signed a deal to sell Pacific Corporate Park, totaling 700,000 square feet of office space and 22 acres of developable land on the eastern portion of its campus, to CB Richard Ellis Realty Trust for $144.5 million.

Real estate services firm CB Richard Ellis Group Inc. represented AOL in the transaction. Despite the disposition, AOL continues to have a strong presence at its campus, with three office buildings totaling 500,000 square feet for its 1,800 full-time workers, two childcare buildings, a warehouse and a data center.

AOL had emptied Pacific Corporate Park of its employees earlier this year, rendering the facilities appropriate for the company’s current strategy of disposing of non-core real estate assets. Developed over a two-year period beginning in 2000, the structures sit just off Route 28 about 30 miles east of Washington, D.C., and carry the addresses of 22110, 22260, 22265, 22270 Pacific Boulevard. Raytheon is the lead tenant at Pacific Corporate Park, having signed a lease agreement in 2009 for every single square-foot in three of the four buildings, and a portion of the space in the fourth building for an aggregate 600,000 square feet. The technology company’s lease on the space lasts through February 2021.

With the purchase of Pacific Corporate Park, CBRE Realty Trust will also get its hands on two parcels at 22275 Pacific Boulevard and 22341 Dresden Street that are entitled tot accommodate two additional 180,000 square-foot buildings. However, with an 18.6 percent vacancy rate, according to a third quarter report by CBRE, Loudoun County is not currently in need of 360,000 square feet of new office space. But the future is a different story. “Loudoun County is not a large market, it has about 13 million square feet of office space,” Marianne Swearingen, research manager with CBRE, told CPE. “It’s unknown what potential impact the planned Metro extension to Dulles Airport may have on the market. Some companies are already looking for build-to-suits with an office/industrial mix in the area, and data centers are doing very well in Northern Virginia because of its advanced fiber optic network. Northern Virginia is the Silicon Valley of the East Coast.”

CBRE Realty Trust plans to finance the purchase of Pacific Corporate Park with net proceeds from its current public offering. The transaction is on track to close in November. Sphere: Related Content

Morgan Lewis HQ in DC Sold for $220 Million

Real Estate Alert - October 13, 2010

In one of the biggest deals in Washington this year, Invesco Real Estate last week acquired a fully leased office building near the White House from a Shorenstein Properties partnership for about $220 million.

The off-market transaction for the 331,000-square-foot property, at 1111 Pennsylvania Avenue NW, is further evidence of strong demand for core buildings in the nation's capital. The price tag of roughly $665/sf translates into a 4.9% capitalization rate - the lowest seen recently in that market. Cap rates for core office properties in Washington have ranged from 5% to 6.5%, with larger properties trending toward the upper end of that range.

The Shorenstein partnership marketed the property for two months in the spring via Eastdil Secured, but pulled the listing after bids fell short of expectations. The partnership, still advised by Eastdil, then struck a deal with Invesco, which acted via its $1.7 billion open-end Invesco Core Real Estate Fund. Market players put the price at close to $220 million.

The property, known as the Presidential Building, is fully leased to Morgan Lewis until July 2017. The law firm pays a triple-net rent of $32/sf. The local East End submarket has 42 million sf of office space that is 91.3% occupied.

The trade is among the biggest in the city this year in terms of both per-foot and outright prices. The only larger trade on a per-foot basis involved the Evening Star Building. TIAA-CREF acquired that 227,000-sf property in June from a KanAm partnership for about $793/sf, or $180 million. The capitalization rate was 5.3%. The Evening Star Building, at 1101 Pennsylvania Avenue NW, is next to the Presidential Building.

The city's largest office trade by overall price this year was Northwestern Mutual Life's purchase of the 589,000-sf Two Constitution Square from a Walton Street Capital partnership for $305 million, or $518/sf. The June transaction carried a 6.2% initial annual yield.
Shorenstein, a San Francisco fund shop, owned 1111 Pennsylvania Avenue via a partnership that included investors Mark Karasick, Victor Gerstein and David Werner. They teamed up to buy it in 2004 for $158 million, or $477/sf, from the estate of Washington surgeon and investor Laszlo Tauber.

The 14-story building is at the northeast corner of 12th Street, five blocks from the White House. When it was erected in 1967, its address was 415 12th Street NW. In 2002, the property underwent a $40 million renovation that shifted the main entrance to Pennsylvania Avenue. Sphere: Related Content

New REIT Formed to Pursue Sale Leaseback Deals in US & Europe

GlobeSt.com - October 20, 2010

Former W.P. Carey CEO Gordon DuGan and US investment head Benjamin Harris have teamed up with American Realty Capital’s Nicholas Schorsch and William Kahane to compete on W.P. Carey’s turf. They’ve formed Corporate Income Properties ARC Inc. a joint venture that will focus on corporate sale-leasebacks in the US and Europe.

A W.P. Carey spokesman referred GlobeSt.com to a comment from CEO Trevor Bond appearing in the Wall Street Journal. “Our success is based on the strength of a whole organization and not just one or two people,” Bond told the WSJ. “We have a process based on 37 years of accumulated institutional expertise. No one has replicated our success in the net-lease sector.” DuGan left W.P. Carey in July over disagreements with chairman William P. Carey about long-term investment direction.

According to an SEC filing by Northcliffe Asset Management, which DuGan and Harris formed in September, the JV intends to raise a minimum of $200 million and a maximum of $500 million to acquire single-tenant commercial properties and lease them back to the sellers. The IPO is being handled by Realty Capital Securities, an affiliate of American Realty Capital.

Corporate Income Properties will invest, directly or indirectly, at least 85% of the net proceeds in single tenant net-leased commercial properties and will limit aggregate borrowings to between 50% and 60% of the aggregate cost of investments, according to a spokesman. While the primary geographic target will be US markets, up to 25% of the portfolio may include properties purchased internationally.

The issuers expect unlevered cap rates of 8% to 9%. Leases will run at least 10 years, the spokesman says.

Last week, Schorsch announced the launch of American Realty Capital Healthcare Trust, a non-traded healthcare REIT that will target medical office properties. The JV with DuGan and Harris, which is also expected to qualify as a REIT, fits in with the Schorsch strategy of sector-specific, publicly registered, non-traded REITS.

Currently, Realty Capital Securities is raising more than $10 billion for seven non-traded REITs, according to the American Realty Capital spokesman. The company has raised more than $1 billion in the past 20 months and is currently raising about $140 million a month. Last month, RCS fundraising accounted for 18% of the total equity raised in the non-traded REIT market for September, the spokesman says. Sphere: Related Content

Barclays Seeking Sale Leaseback of Another 55 Bank Branches in Spain

Reuters Spain (as translated by Google) - October 14, 2010

British bank Barclays has given a mandate to sell and then rent in multiple packages of 55 of its branches in Spain, said Thursday a spokesman for the British bank.

"We have a book sale at CBRE to seek a buyer for a total of 55 offices," confirmed a spokesman for Barclays.

Industry analysts estimate that, taking into account the nearly 2.3 million per year that Barclays would pay rent for the rental of office and assuming a yield (yield) of 6 percent within 10 to 15 years - - common in these transactions - the bank might enter around 38 million euros with the operation.

The spokesman said the bank has about 590 branches in Spain.

Barclays already has operations similar to this in the past and also put on sale May 34 branches in the same regime.

This type of sales operations for subsequent rental of the premises of the network of offices are still very common in commercial banks to raise funds and improve without losing credit portfolio management.

However, unlike other banks BBVA and Santander, Barclays has opted to sell the offices in small packages and no large lots of branches and distinctive buildings. Sphere: Related Content

CVS Enters $110 Million Sale Leaseback of 36 Drug Stores in 19 States

PRWeb - October 13, 2010

The Landes Investment Group Inc., a privately held real estate investment and development company, announced today that entities affiliated with it have acquired 36 CVS pharmacy properties valued at approximately $110 million. The properties, which were acquired from CVS in September 2010 in sale-and-leaseback transactions, are located in 19 states; two of them are in the Dallas area, where the Landes Investment Group is based.

“We are pleased to acquire these properties and complete another transaction with CVS, further augmenting our robust portfolio of investments,” says Brett Landes, the company’s founder and president. “We have had a strong, mutually beneficial relationship with CVS for more than a decade, and we look forward to continuing that association.”

Entities affiliated with the Landes Investment Group secured financing for the properties through Teacher Insurance & Annuity Association (TIA-CREF) and Prudential Capital Group. Liechty & McGinnis LLP served as advisor and legal counsel on the transactions.

In 2009, LLWG Capital Inc., an entity affiliated with the Landes Investment Group, purchased 313 CVS pharmacy properties valued at $1.375 billion. The acquisition of those properties, located in 33 states, came via three separate sale leaseback transactions last year.

CVS is the nation’s largest provider of prescriptions and related healthcare services, with more than 7,000 locations. Sphere: Related Content

State of California Selects Buyer in $2.33 Billion Sale Leaseback Deal

Business Wire - October 11, 2010

Today, the Department of General Services announced it has selected California First, LLC, a partnership led by Hines and Antarctica Capital Real Estate LLC, as the buyer for 11 state office properties authorized by the legislature and Governor last year. The winning offer was $2.33 billion — resulting in more than $1.2 billion for the state general fund, and $1.09 billion to pay off bonds on the buildings. Over the next 20 years, the state will lease the offices back from the new owner at predetermined rates, and will no longer maintain, operate, or repair the buildings. All the leases with California First allow the state to buy back any or all of the buildings at anytime during the 20-year term.

“After an extensive review of the more than 300 bids that were received, I have determined that this offer presents the best value for the state and achieves the goals set forth by the Legislature and Governor,” said Acting DGS Director Ron Diedrich. “This sale will allow us to bring in desperately needed revenues and free the state from the ongoing costs and risks of owning real estate.”

Hines, a privately owned real estate firm headquartered in Houston, Texas, is involved in real estate investment, development and property management worldwide. The firm’s historical and current portfolio of projects that are underway, completed, acquired and managed for third parties includes 1,119 properties representing more than 457 million square feet of office, residential, mixed-use, industrial, hotel, medical and sports facilities, as well as large, master-planned communities and land developments. Antarctica Capital Real Estate, LLC; a venture led by California real estate veteran Rich Mayo of Spyglass Realty Partners, along with Chandra Patel of Antarctica Capital headquartered in Irvine, California and New York, NY, is a private equity firm specializing in real estate. There are also additional equity investors. The all cash offer will utilize a typical debt and equity ratio with the general partners and investors providing approximately 40 percent of the purchase price, and a major financial institution supplying the balance as a loan to the new owners.

In his letter to the legislature, Diedrich shared the department’s economic analysis summary of the sale comparing the status quo of ownership of the buildings to the sale and leaseback transaction. Using a series of reasonable and prudent assumptions the analysis shows that the sale allows California to retire $1.09 billion in bond debt, leaving over $1.2 billion in new revenues to shore up the state budget, as a result eliminating the need for more program cuts statewide or tax increases. By no longer owning the properties, the state eliminates annual lease payments and interest, as well as operating expenses. The state also sheds the responsibility for deferred and major capital improvements, as well as the obligation to pay for unforeseen and unpredictable repairs that cannot be anticipated but are increasingly likely as the buildings age.

In April, the state’s broker, CB Richard Ellis received more than 300 offers to purchase the buildings. The offers included individually priced offers on each building; however, the most aggressive pricing came largely from 30 offers for the entire portfolio. Portfolio buyers were given the opportunity to submit a second round of offers on May 11. CBRE received 16 increased portfolio offers, 11 of which exceeded the state’s $2 billion estimate of the value of the properties. Those 11 bidders were then invited to submit a “best and final” offer by May 21.

Since May 21, DGS, in conjunction with its broker, has been evaluating the top offers. This evaluation included a comprehensive analysis of each of the 11 best and final offers which included separate interviews with each finalist. Buyers were evaluated based on a reconciliation of two primary factors – price and certainty of execution. CB Richard Ellis investigated with DGS the bidder’s track record; and how much due diligence the bidder had done on the state properties prior to making a buyer selection. Evaluation criteria included whether due diligence reports were reviewed; due diligence inspections were completed; the extent of property tours; the nature of contract and lease comments; the financial backing the buyer had in place and finally, the buyer’s ability to both remove contingencies and close the transaction quickly.

“The State of California received significant portfolio interest, and the proceeds at the sale price of $2.33 billion will far exceed the $660 million originally estimated. Far from a fire sale, this was a stiff, multiple offer competition that generated favorable pricing for the state,” said Kevin Shannon with CBRE, who handled the sale on behalf of the state. “Current historically low interest rates have allowed the state to obtain extraordinary pricing comparable with peak level capitalization rates with leaseback rents well below peak market levels. An additional benefit is that the state will be getting out of the commercial real estate management business, and transferring asset management to Hines, a globally recognized leader.”

The Department of General Services anticipates completing all transactions in the 4th quarter of 2010.

Downloads:

Original Sale Brochure

DGS Financial Analysis Summary

Video/Photos Sphere: Related Content

Freight Links Enters Into S$193 Million Sale Leaseback of Five Logistics Properties in Singapore

Singapore Exchange - October 11, 2010

Main board-listed Freight Links Express Holdings Limited (“Freight Links”), one of the leading logistics management and integrated freight forwarding groups in Singapore, has entered into proposed sale and leaseback transactions with Sabana Investment Partners Pte. Ltd. (“SIP”), for the benefit of the proposed Sabana Shari’ah Compliant Industrial Real Estate Industrial Trust (the “Sabana REIT”), for five of its properties for a total consideration of S$192.95 million, with a leaseback period of 5 years (the “Proposed Sale and Leaseback”). Subject to the receipt of the relevant regulatory approvals (including approval of the Monetary Authority of Singapore), the Sabana REIT is a Singapore-based real estate investment trust to be established and authorised in Singapore principally to invest in income producing real estate used for industrial purposes in Asia, as well as real estate-related assets. The five properties are at 30 & 32 Tuas Avenue 8, 218 Pandan Loop, 51 Penjuru Road, 33 & 35 Penjuru Lane and 18 Gul Drive (the “Properties”).

The sale of the Properties (the “Proposed Sale”) will result in net proceeds over the book value of the properties amounting to approximately S$99.4 million.

Freight Links, through its 51% shareholding equity interest in SIP, will participate in (subject to the receipt of relevant regulatory approvals) the manager (the “REIT Manager”) and the property manager (the “Property Manager”) of the Sabana REIT. Sabana REIT plans to acquire a portfolio of properties worth about $850 million. A conditional eligibility-to-list letter (the “ETL”) was received on 8 October 2010 from the Singapore Exchange Securities Trading Limited (the “SGX-ST”) for the listing of and quotation for the units in the Sabana REIT on the Main Board of the SGX-ST.

The Proposed Sale and Leaseback constitutes a major transaction for Freight Links, requiring the approval of the shareholders at an Extraordinary General Meeting to be convened at a later date.

The Proposed Sale and Leaseback is also subject to, amongst other things, (a) the listing of the units in the Sabana REIT and commencement of trading of such units on the SGX-ST, and (b) obtaining JTC Corporation’s approval (and the approval/clearance of such other authorities as JTC may require).

Freight Links Express Holdings Limited (“Freight Links”) is one of the leading Logistics Management and Integrated Freight Forwarding Groups in Singapore. Established in 1981, the international freight forwarding business of the Group has links to almost 600 destinations throughout the world. Freight Links has offices in Malaysia, Thailand, Hong Kong, China, South Korea and United Arab Emirates. Sphere: Related Content

Esporta Seeking GBP 200 Million in Sale Leaseback of 17 Fitness Centers in the UK

Estates Gazette - October 4, 2010

The French owner of fitness club chain Esporta is preparing to bring a £200m sale-and-leaseback portfolio to market.

Investment bank Société Générale will soon start marketing a package of 17 of its Health and Racquet clubs in locations including Oxfordshire, Brighton and Cardiff.

Esporta has a total of 55 clubs in the UK.

Colliers International, which was appointed by SocGen last year to provide asset management advice on the portfolio, is expected to be instructed with the sales mandate.

It is not known whether the bank will be providing debt for the sale-and-leaseback.

One source said: “It will be difficult to get bank debt for the deal because it is an untested covenant and not a very popular asset class. However, a number of opportunistic companies could be interested.”

The source added that it is expected that SocGen will seek to sell the operating business in the future.

Esporta was previously part of Syrian property tycoon Simon Halabi’s empire. Halabi bought the chain from private equity group Duke Street Capital for £476m in 2006, with £330m of funding from SocGen.

However, Esporta’s holding companies, Bell Leisure I and Bell Leisure II, collapsed into administration a year later. SocGen took ownership, completing a debt-for-equity swap. Sphere: Related Content

Woolworths Enters $75 Million Sale Leaseback of Distribution Center in Australia

Transport & Logistics News - September 28, 2010

The Charter Hall Group has agreed to purchase and lease back a new Woolworths regional distribution centre in Tasmania for $75 million.

Construction is due to commence in October 2010 and the centre will comprise approximately 46,000 square metres of state-of-the-art logistics space. The facility will be developed by Woolworths Limited who will lease the premises for 25 years from completion, anticipated to be late 2011.

The 19.8 hectare site is located adjacent to the Launceston Airport on freehold land and provides for significant expansion, with development approval to build an additional 25,000 square metres. The facility will be operated by Statewide Independent Wholesalers Limited and will service 28 Woolworths supermarkets, 19 BWS stores and 208 independent retailers throughout Tasmania.

The property was purchased on an initial yield of 8.6%, with guaranteed fixed annual rental increases of 2.8%. Sphere: Related Content

Cumberland Farms Offering 61 Net Leased Convenience Stores Along East Coast

Convenience Store News - September 21, 2010

Cumberland Farms Inc. will sell 61 convenience store properties through a structured sale process to be managed by Matrix Capital Markets Group Inc.

Cumberland Farms owns the real estate at these sites, and leases them to third party tenants through triple net lease agreements, under which the tenants operate independent convenience stores and other retail businesses, according to a release by Matrix.

Bids can be submitted for individual stores or for multiple stores, and offers are due Oct. 29, 2010, but Cumberland will consider accepting offers prior to the deadline.

While the stores are a steady source of income for Cumberland, owning the real estate at the 61 independently operated locations no longer fits with Cumberland's strategic growth plans, according to the release. Cumberland will use the capital from the sale to redeploy in other areas of their business.

The stores are located along the East Coast, and includes three stores in Connecticut; five in Delaware; 10 in Florida; 12 in Massachusetts, three 3 in New Hampshire; eight in New Jersey; 14 in New York, two in Pennsylvania; and four in Rhode Island.

Of the stores, 34 currently sell motor fuels, which are primarily unbranded. Cumberland currently supplies fuels to most of these locations, excluding stores in Florida. Going forward, buyers of the Cumberland-supplied sites are not required to purchase fuels from the company, and can choose their own fuel supplier after closing, according to Matrix.

In addition, 19 of the properties have additional retail space leased to other tenants such as restaurant franchisees, beauty care salons, and other businesses, under triple net lease agreements. The average building size is approximately 3,100 square feet, with the average convenience store size being approximately 2,200 square feet.

Matrix also noted the remaining lease durations for current tenants are short term, while others leases are expired or may be terminated if the property is sold. The average remaining tenant lease duration for the stores is approximately 2.7 years including option periods. There are currently seven stores that can be operated by the buyer by the end of 2010, while an additional 17 stores can be operated by the purchaser in 2011.

Stores included in the sale provide income averaging approximately $3.21 million per year, and existing tenants are motivated to renew leases, according to the release. Cumberland has not pursued lease extensions with existing operators, as the assets are not long term strategic assets for the company, according to Matrix.

Matrix assembled an online data room containing site information, sales procedures and other relevant information. To gain access to the online area, a confidentiality agreement must be completed and returned by Matrix via fax at (804) 780-0191, or completed online at http://www.matrixenergyandretail.com/sale_details.php?sale=52. Sphere: Related Content

VeriSign Agrees to 15-Year Lease for Former Sallie Mae HQ in Reston, VA

Citybizlist Washington DC - September 24, 2010

VeriSign, Inc. has signed its long-rumored lease with landlord 12061 Bluemont Owner, LLC to lease 221,326 square feet and related parking facilities and other amenities located at 12061 Bluemont Way in Reston, the current Sallie Mae headquarters. During the fifteen year term of the Lease, the Company is to make aggregate payments of fixed rent in the approximate amount of $105,834,000.

The deal was signed on September 15.

The Company has the right to occupy the Premises from and after the commencement date of the Lease, which is expected to occur no earlier than February 1, 2011. The Commencement Date shall occur after the expiration of the current tenant's lease for the Premises and such current existing tenant's vacancy of the Premises, which shall occur no later than August 31, 2011.

In the event the Commencement Date does not occur by November 30, 2011, VeriSign has the right to terminate the Lease.

The initial term of the Lease is for a period of fifteen years and five months following the Commencement Date. The Company has the right to renew the term of the Lease for up to two consecutive five-year periods. In the event the Landlord desires to sell the Premises during the term of the Lease, the Landlord must first offer the Premises to VeriSign, subject to certain exceptions, including the sale of the Premises to affiliates of the Landlord or in connection with the sale of a portfolio of properties of which the Premises is a part.

Payments of fixed rent are to be made monthly pursuant to a schedule set forth in the Lease, which monthly payments shall begin on the 151st day following the Commencement Date. Fixed rent for any renewal term would be the then fair market rental rate for the Premises. In addition to fixed rent, the Tenant is required to pay all real estate and similar taxes imposed on the Premises.

Under the Lease, the Company is generally responsible, at its cost, for the operation, management, repair and, if necessary, replacement of the Premises during the term of the Lease, provided that the Landlord pays some of the costs incurred in connection with capital improvements. Sphere: Related Content

Providence Health Plan Signs to Long Term Lease Renewal of HQ in Beaverton, OR

REBusinessOnline - September 24, 2010

Grandbridge Real Estate Capital has originated and closed a more than $63.2 million fixed-rate loan secured by Murray Business Center, a 332,000-square-foot suburban office building located in Beaverton. Funding for the transaction was provided by TIAA-CREF. The loan was made at 98 percent of appraised value with an interest rate of 5.61 percent fixed for the entire 21.3-year loan term. The transaction features an initial 39-month interest-only component with negative amortization, which converts to an 18-year amortization. Rob Meister of Charlotte, N.C.-based Grandbridge, a subsidiary of BB&T Corp., arranged the financing on behalf of a long-time client. The main tenant at Murray Business Center currently occupies 72 percent of the property with an unrelated, non-credit tenant occupying the remaining portion of the property until September 30, 2013, at which time the main tenant takes over the entire building. Sphere: Related Content

Cole Real Estate Investments to Raise $3.5 Billion in Each of Two IPOs of Single Tenant REITs

Business Wire - September 23, 2010

Cole Real Estate Investments, a sponsor of non-traded REITs, announced today the filing of two registration statements with the Securities and Exchange Commission: one for Cole Advisor Retail Income REIT, Inc. and the other for Cole Advisor Corporate Income REIT, Inc. The announcement was made by Marc Nemer, President of Cole Real Estate Investments.

Cole Advisor Retail Income REIT and Cole Advisor Corporate Income REIT are newly organized corporations formed to invest primarily in single-tenant, income producing commercial properties, which are leased to creditworthy tenants under long-term net leases. Cole Advisor Retail Income REIT will focus primarily on necessity retail tenants, while Cole Advisor Corporate Income REIT will focus on mission critical office and industrial properties.

Each of the companies intends to distribute shares principally through registered investment advisors and broker/dealers that charge their clients a fee for their services. These accounts are typically referred to as wrap accounts or fee-based accounts.

The common shares of each company is expected to be offered on a continuous basis and for an indefinite period of time, subject to regulatory approvals, with an initial offering for each company of up to $3,500,000,000. After an initial escrow period, the purchase price for each company’s stock will vary from day to day and, on any given day, will be equal to that company’s net asset value, or NAV, divided by the number of common shares outstanding for that company, as of the end of business on each day (NAV per share). The calculation of each company’s NAV will be based principally on the market value of the company’s real estate portfolio, as determined by an independent valuation expert. Each of the companies also expects to offer their shareholders the opportunity to redeem all or any portion of their shares, on a daily basis, at the company’s NAV per share, determined as of the end of the day of the request. The offerings are not contingent on each other. Sphere: Related Content

US Federal Properties Trust to Raise $350 Million in IPO of Single Tenant REIT

The Wall Street Journal - September 22, 2010

US Federal Properties Trust Inc. unveiled estimated terms of its planned initial public offering, as the real-estate company raises funds to repay debt and for other purposes.

The company--which acquires, develops and manages properties leased to the U.S. government--is seen selling at least 13.8 million shares at an estimated price of $19 to $20 a share, according to a filing with the Securities and Exchange Commission. This is essentially all of the stock to be outstanding after the IPO.

US Federal Properties, which plans to become a real-estate investment trust this year, had estimated raising up to an estimated $350 million when it filed its initial IPO plans in May.

Upon the completion of the IPO, the company expects to own 19 single-tenant properties in 11 states. It has developed eight federal government-leased properties since 2001 with another one under way. Tenants include agencies such as the Federal Bureau of Investigation and federal courts.

The company expects government leasing of buildings will continue to grow owing to the large capital expenditures associated with constructing and maintaining such buildings themselves.

For the six months ended June 30, U.S. Federal Properties' earnings rose 23% to $901,000 as revenue nearly doubled to $3.6 million.

The company has been approved to list on the New York Stock Exchange under the symbol USFP. Sphere: Related Content

Orbis Hospitality Seeking Sale Leaseback of Over 30 Hotels in Poland and Lithuania

WSEInfoSpace - September 23, 2010

Listed hotel operator Orbis wants to carry out sale-leaseback deals on over half of its hotels within the next 4-5 years, CFO Marcin Szewczykowski told reporters.

"In the period of up to 4-5 years over half of the buildings in which we have hotels will stop being our property," Szewczykowski said. "We want to carry out sale-leaseback deals on those properties."

At end-H1 the value of Orbis fixed assets stood at PLN 2 bln ($681 million) but this sum does not reflect the market value, Szewczykowski added.

Currently Orbis has 62 hotels in Poland and Lithuania. Sphere: Related Content

Albertson's Agrees to $276 Million Sale Leaseback of 33 Grocery Stores

CoStar Group - September 22, 2010

Cole Credit Property Trust III Inc. agreed to purchase 100% of Albertson's interest in 33 retail properties comprising 1,916,854 million square feet throughout the U.S. for $276 million.

The Albertson's portfolio consists of 33 single-tenant commercial properties in Texas, Arizona, New Mexico, Louisiana and Colorado. The properties are 100% occupied by Albertson's, which will also lease back each property.

The leases will be identical for each property and run for 20 years with six 5-year lease renewal options. The initial annual base rent for the properties will be $19.77 million (for an initial yield of approximately 7.2%) for a base rent of $10.31/square foot. The annual base rent under the lease increases every five years by 10% of the then-current annual base rent.

Cole put down a $10 million deposit and has a 30-day due diligence period, during which it may terminate the agreement for any reason.

Cole officials would not comment on the agreement until after and if it went to closing. The acquisition of the properties is expected to be completed by Oct. 19, 2010. Sphere: Related Content

Accor Completes EUR 39 Million Sale Leaseback of Hotel in Munich

Property Magazine International - September 14, 2010

Invesco Real Estate (IRE) announces that it has concluded the acquisition of the Novotel City Centre hotel in Munich, Germany for an investment of €39m in an off-market deal, with financing provided by Bayern LB. This is the fifth hotel the firm has bought this year for its dedicated pan-European hotel fund , with purchases in France, Italy and Stockholm concluded earlier this year. This brings to 14 the total number of hotels the fund now has under management and represents over €600m of investment into this specialised real estate sector.

The latest acquisition was purchased as part of a sale and lease back portfolio of five hotels from Accor and operates under the Novotel brand. IRE currently has a further two hotels under contract, which are expected to conclude later in 2010.

The Novotel City Centre is a modern 4* business hotel, opened in 2004, with 307 rooms, restaurant, bar, meeting rooms, pool and fitness centre. It is located in the heart of the Bavarian state capital, just minutes from the Deutsches Museum, the Gasteig cultural centre and the old town. Accor is one of the leading global hotel operators with strong branding and covenant. The acquisition is in line with IRE’s hotel fund’s investment strategy of building a diversified pan-European portfolio of leased mid-market hotels. Sphere: Related Content

Goodyear Distribution Portfolio Sold for $172.5 Million

Citybizlist Dallas - September 9, 2010

Six Goodyear Tire and Rubber Company industrial distribution facilities totaling 4.7 million square feet, including two in Atlanta, and one each in Chicago, Central Pennsylvania, Dallas and Columbus, OH, have been sold by Dividend Capital Total Realty Trust to Cardinal Industrial Real Estate Services for $172.5 million.

With the acquisition, Sherman Oaks, CA-based Cardinal Industrial increased its portfolio of single tenant industrial assets located throughout the United States to approximately 13.4 million square feet.

The Portland office of HFF (Holliday Fenoglio Fowler, L.P.) arranged $114 million in financing for the industrial distribution facility acquisition, with HFF senior managing director Lloyd Minten working on behalf of Cardinal Industrial Real Estate Services to secure the loan. It will be included in an upcoming CMBS securitization and serviced by HFF.

Loan proceeds were used to acquire the portfolio from Dividend Capital Trust, which acquired these assets as part of the iStar portfolio sale. On June 25, 2010, Dividend Capital Total Realty Trust Inc. completed the acquisition of a portfolio of 32 office and industrial properties, aggregating approximately 11.3 million net rentable square feet known as the National Office and Industrial Portfolio, or NOIP, from iStar Financial Inc.

Dividend Capital will used the proceeds from the sale of the Goodyear Tire Distribution Facilities to repay approximately $169.1 million of outstanding borrowings that had been used to partially finance its acquisition of NOIP. The Goodyear Portfolio included all of its properties that were leased to Goodyear Tire & Rubber Company. Sphere: Related Content

Gladstone Commercial Registers $300M in Securities

Washington Business Journal - September 9, 2010

McLean-based investment company Gladstone Commercial Corp. registered $300 million in securities Thursday.

The registration allows Gladstone Commercial, part of David Gladstone’s family of companies, to issue from time to time common stock, senior common stock, preferred stock, debt securities, depositary shares and subscription rights. Any proceeds from the sales would be used for general corporate purposes, the company said in a securities filing.

Gladstone Commercial (NASDAQ: GOOD) primarily invests in net-leased industrial and commercial real estate property and long-term industrial and commercial mortgages. It has $411.2 million in assets and posted a $17,361 net loss available to common shareholders in the second quarter. Sphere: Related Content

Christie's Signs 30 Year Lease for Brooklyn Warehouse

Brooklyn Daily Eagle - September 7, 2010

In the past few weeks, Brooklyn has gotten a little wealthier—at least in theory. And its culture quotient has popped a couple notches, too. But the assets responsible for these surges are locked behind state of the art security on Red Hook’s waterfront.

In early August, Christie’s Fine Art Storage Services (CFASS) opened its largest facility to date in one of two sister buildings owned by a local Brooklyn real estate developer.

A subsidiary of the Auction House, CFASS, which has locations in London and Singapore, does not actually have an auction element, but instead provides top of the line storage — and display services to facilitate sales, if needed — for valuable pieces.

A perfect fit might have brought more jobs for locals and working artists, but that’s not going to be the case. “You don’t need a lot of people to move art,” said Joel Weinberg, CFASS’s New York general manager, with a hint of disappointment. He leads a staff of five, two of whom have ties to the Red Hook art scene, plus a security team.

Weinberg hasn’t ruled out other opportunities for contributing to the local economy, as CFASS has finished only two of its six floors. Those two floors feature more than 100 private rooms, units of managed storage (larger space shared by smaller collections) and several viewing galleries, which offer clients a museum-quality venue in which to show their art.

The four unfinished floors have all their mechanicals in, but Weinberg said the company wants to stay nimble to unanticipated client needs. And he said local industry could play a role in the buildout.

But interested contractors should probably come with impeccable reputations. Weinberg said that one insurance representative described the facility as “art storage on steroids.” A beeping soundtrack of high-tech security accompanied a tour of the gleaming corridors. Purified, dehumidified air, kept at a constant 70 degrees, wafted overhead. The original gray, pebbled floors were buffed to a smooth finish. A multimillion-dollar elevator system, capable of carrying a classic Rolls Royce, bookends halls bathed in brilliant white and shimmering chrome, a kind of wainscoting that adds protection to the steel-enforced walls.

Hundreds of motion-sensor video cameras sprout from the ceilings and walls, inside and out. It’s no wonder that CFASS had a line of clients waiting to stow their Picassos and Pollocks.

But CFASS doesn’t intend to wall itself off from the community. “We’re going to try to develop a relationship with Brooklyn,” said Weinberg. He said CFASS might hire another five or six people as inventory grows. And the company already has formed a catering relationship with Kevin Moore of Kevin’s restaurant on Van Brunt Street.

In some ways, CFASS does seem to be the perfect tenant for Red Hook. With a 30-year lease, the wholly owned subsidiary of Christie’s international art business offers some protection from disruptive development that might raise rents aggressively. Sphere: Related Content

Woolworths Seeking AU$900 Million Sale Leaseback of Over 30 Shopping Centers in Australia

The Australian - September 7, 2010

Woolworths is offloading a $900 million-plus portfolio of shopping centres.

After unsuccessfully sounding out potential investors in the portfolio, the retailer is seeking tenders, in its largest sale of property assets.

The last time Woolies sold a chunk of its assets was in June 2006 when it sold 11 distribution centres to a consortium led by Lend Lease for $846m.

The properties, which will be leased back by Woolies, include Ashgrove Marketplace in Queensland, Carnes Hill Marketplace in NSW and Pakington Strand in Geelong West, Victoria.

Woolworths property director Ralph Kemmler said it was not unusual for the retailer to develop and sell assets.

It had been developing shopping centres since the early 1990s, Mr Kemmler said. It stepped up development during the global crisis, when developers and listed property trusts drew back.

"We had to step in to fill the hole to keep up with our new store openings," he said.

Last year, it completed between 10 and 12 new centres, he said, and it would continue in-house development.

"This is a unique bundle of assets consisting of supermarkets, some with a cluster of shops around them, and sub-regional centres."

Mr Kemmler said local and offshore investors were interested in a sizeable portfolio, ranging from $300m to $1 billion.

There was "money available on the world market that would be interested in investing in quality assets".

Woolworths hopes to conclude a transaction in the next six months. "There is no urgency to offload this portfolio," Mr Kemmler said.

The retailer owns more than 1000 properties nationally and last year sold about $100m of centres and service stations.

Woolworths and its US joint-venture partner Lowes are planning 150 hardware stores, and have secured half of the sites. However, Mr Kemmler said, the sale was not an exercise in recycling to build the hardware stores.

"They went around to a lot of people asking for a proposal for the assets earlier this year," a leading funds management group's property head said.

"It is an awkward time for them to be offering the assets. They will be competing, for instance, with the Centro portfolio," he said.

The main issue would be the leases, which favoured the retailer. "It is hard to do a deal with Woolworths."

Another source said the Future Fund and the Canadian pension funds were unlikely to be interested. Sphere: Related Content

ECM Realty Trust Plans $380M IPO of Net Lease REIT

The Wall Street Journal - August 26, 2010

ECM Realty Trust Inc. plans to sell up to an estimated $380 million in shares through an initial public offering of its stock to repay debt and make acquisitions.

The commercial real-estate company will own 39 net leased properties when the IPO is completed and aims to become a real-estate investment trust, according to a filing with the Securities and Exchange Commission.

The number of IPOs in the pipeline continues to rise, though the number being completed is lower, with a series of companies cutting prices or pricing below their expected ranges. Meanwhile a number of real-estate concerns have been raising capital while hoping to acquire properties while the market is weak.

Potential acquisitions in ECM's pipeline have an estimated total purchase price of more than $400 million.

The company's initial properties were 100% leased as of June 30, with no lease expirations until 2015. Most of its office properties are corporate or regional headquarters, while its industrial properties are "significant regional or critical hub distribution facilities" and the "substantial majority" of the retail properties are in "high-performing locations."

For the first half of this year, ECM's loss widened to $1.5 million from $138,000 amid acquisition costs while revenue rose 1.6% to $14.3 million.

The company intends to apply for listing on the New York Stock Exchange under the symbol ECMR. Sphere: Related Content

Newark NJ Mulls $50 Million Sale Leaseback of City Properties

NJ.com - August 25, 2010

Desperate to close an $83 million deficit, Newark plans to sell one of the last assets it has remaining. Itself, one municipal building at a time.

Police precincts, fire houses and office buildings are being eyed for a sale the city council hopes will generate $50 million for the 2010 budget.

The financial gambit calls for the Essex County Improvement Authority to sell bonds to buy the buildings and then lease them back to Newark over a period of years, according to a plan laid out Tuesday by city and county officials.

It’s a costly and risky solution. With capital improvements, fees and services, the deal is expected to cost the city about $60 million in the long term.

Before any of that happens, the city will have to run through a gauntlet of bureaucracy at warp speed. The plan has to be approved by the authority, the Newark City Council, the Essex County Freeholders, and the state Local Finance Board.

But city leaders say they are running out of time and options to forestall a crippling financial meltdown. Without a solution soon the city will be forced to levy a 30 percent tax increase. Even with the "lease-back" revenue, Newark is facing a possible 20 percent property tax hike and more than 600 layoffs.

The city must have the $50 million in its accounts by mid-November in order to guarantee a balanced budget for this year — and avoid a potential takeover by the state. City officials Tuesday said there was no room for error or delay.

"We’ve built a calendar around a Nov. 12 to a Nov. 18 window, and we’ve worked backward," said Henry Amoroso, a paid city budget consultant. "This is unprecedentedly tight."

City leaders and budget experts disagree on how the city found itself in a budget crisis. Some say the mayor should have attacked the city’s bloated spending years ago. Others say the recession has choked off revenues at the worst possible time for Newark.

Though selling your police precincts seems a bizarre way to raise money, some urban experts say it's a solution that’s catching on.

"The variety of places that are exploring a variety of measures is really quite striking," said Mark Muro, senior fellow at the Brookings Institution. Newark is "really quite in the mainstream," he said.

Mayor Cory Booker’s office would not provide the list of properties being considered, but Amoroso said the buildings had to be in reasonably good condition and the city had to be the tenant. The finance building on Broad Street, one of Newark’s main drags, was mentioned as a good example, along with the city welfare building and the child and family well-being building. The only building not on the table is City Hall, officials said.

"We’re going to follow the council’s leadership on which buildings" to sell, said Booker, who stressed that the idea is being pushed by city council members. "At the end of the day, they’re the deciders. They and the Essex County Improvement Authority."

Essex County Executive Joseph DiVincenzo said as long as bond buyers and not taxpayers were the only ones liable in the transaction, he would support it, but he warned that it is far from a done deal.

"It’s just in the beginning stages," DiVincenzo said. "There’s a lot of work that has to be done. Every building has to be appraised."

Newark will pay the county between $50,000 and $100,000 to appraise the properties as well as hire their own evaluators.

The plan was first floated by West Ward Councilman Ronald Rice as one of several alternatives to the creation of a municipal utilities authority to manage the city’s water. When the council tabled the MUA, it was left with a $70 million hole in the 2010 budget. That number has grown to $83 million, Amoroso said Tuesday.

Rice said he is glad the administration is working more closely with the council after the failure of the MUA.

"I have to give my colleagues credit. They’re the ones who were emphatic that the administration drill down on these ideas," Rice said. "We were told put up or shut up, so we started putting up." Sphere: Related Content

Accor Agrees to $467 Million Sale Leaseback of 48 Hotels in Europe

Reuters - August 23, 2010

French hotel company Accor (ACCP.PA) agreed to sell 48 hotels in Europe for 367 million euros ($466.7 million) as part of its mission to cut debt and secure growth over the next few years.

The deal, which is due to be completed before the end of this year, will give Accor a cash boost of 282 million euros and will add around 3 million euros to its annual pretax profit from 2010, the hotel group said in a statement on Monday.

The hotels include a Novotel at Munich Airport and a 772-room Ibis at Charles de Gaulle Airport in Paris. The two buyers are insurer Predica, part of Credit Agricole (CAGR.PA), and property group Fonciere des Murs (FERP.PA), a subsidiary of Fonciere des Regions (FDR.PA).

Taken together with previous announcements, the deal means Accor has secured a year-to-date positive cash impact of just over 500 million euros from asset sales, above its current full-year target of 450 million. [ID:nLDE64D0LI]

An Accor spokesman was unavailable for comment. The firm said it would continue to manage the 48 hotels under a 12-year variable lease, renewable six times. Average annual rent will be 19 percent of the hotels' revenue, with a minimum guarantee for 2011 and 2012 of 23 million euros (an initial annual yield of approximately 6.25%).

Accor is eyeing asset sales through 2013 of around 2 billion euros to help fund growth after spinning off its cash-rich services unit Edenred (EDEN.PA) earlier this year.

It is aiming for the world No. 3 spot by 2015 and wants to be Europe's largest franchisor. It is currently world No. 4 after InterContinental (IHG.L), Marriott (MAR.N) and the Hilton and Starwood (HOT.N) chains. Sphere: Related Content

Aldi Agrees to Sale Leaseback of 80 Retail Outlets in Southern Germany

The Wall Street Journal - August 20, 2010

Insurer Allianz SE (ALV.XE) paid a 'clear three-digit million euros amount' for the 80 retail outlets in southern Germany owned by Aldi Immobilien KG, a person familiar with the matter told Dow Jones Newswires Friday.

Earlier Friday, Allianz, Europe's largest insurer by premium income, said its German real-estate unit is buying 80 retail outlets in southern Germany from Aldi Sued in a leaseback deal aimed at diversifying its investment portfolio.

Aldi, which is one of Germany's largest discount grocery retail chains, will continue to operate the outlets. Aldi Sued is the main long-term lessee of the outlets, which have an average sales area of 900 square meters, Allianz said.

Spokespeople for Allianz Real Estate Germany GmbH and Aldi Sued declined to comment on the transaction value, saying both parties agreed not to disclose the investment details of the deal.

Frank Neumann, a real-estate stock analyst for Bankhaus Lampe, had said he estimates the value of the deal at around EUR80 million.

Aldi Sued operates more than 1,780 retail branches in western and southern Germany. Aldi Nord operates more than 2,500 retail outlets in northern and eastern Germany. Sphere: Related Content

Eroski Enters EUR45 Million Sale Leaseback of 21 Grocery Stores in Spain

Property Week - August 18, 2010

Rockspring Property Investment Managers has bought a portfolio of 21 Spanish food stores for €45m.

The fund manager has bought the properties, all in the Basque country and Majorca, in a sale-and leaseback-deal with Spanish food retailer Eroski.

Eroski has signed a 20-year lease on the entire 320,000 sq ft portfolio, which was bought on behalf of the single-client account of a UK pension fund.

The UK pension fund account is targeting un-leveraged core and core plus returns across central and western European retail, office and industrial properties – with a toal spending power of €300m.

James Preston, Rockspring Iberia’s managingdirector, said: “Food retail has proven to be a well performing, defensive sector across Spain both before and during the economic downturn; we are therefore pleased to have secured exposure to this successful asset type.

“These properties appealed to us due to the combination of their prime location, strong local economic fundamentals, sustainable rental levels and the quality of Eroski as a tenant.

“As such, the investment provides a high degree of insulation from any further effects of the downturn, as well as being well positioned for any recovery.”

José Miguel Fernández Astobiza, Eroski’s development manager, said “This portfolio disposal shows further progress in our strategy as we seek to dispose of the freehold interest in our properties in order to release capital to develop our commercial retail activities.”

Cushman & Wakefield advised Eroski and Nicea Abogodas advised Rockspring. Sphere: Related Content

WP Carey Funds Build to Suit of Logistics Facility for Neuca SA in Poland

The Wall Street Journal - August 17, 2010

Investment firm W. P. Carey & Co. LLC (NYSE: WPC) today announced that its publicly-held, non-traded REIT affiliate, CPA(R):17 - Global, has provided build to suit financing that will fund 100% of the construction and related development costs for a logistics facility in Poznan, Poland being developed by Panattoni Europe. Upon completion, the facility will be owned by CPA(R):17 and will be fully occupied under a long term triple net lease with Neuca SA (formerly known as Torfarm SA), the largest wholesale pharmaceutical distributor in Poland.

The to-be-built facility will comprise approximately 123,000 square feet and will serve as one of Neuca's three strategic logistics sites for pharmaceutical distribution across Poland. The facility is located in Poznan, the 4th largest logistics hub in Poland. Linking seven national and international roads and located midway between Berlin and Warsaw, Poznan forms an important trade-route junction. Construction is anticipated to be completed in January 2011.

Jeff Lefleur, Executive Director of W. P. Carey, said: "Our large capital base and long term investment approach gives us the ability to finance 100% of construction and related development costs in markets where such capital remains challenging for developers to access. We hope to continue being a reliable funding source to experienced developers such as Panattoni for their long term, single-tenant projects. We are also pleased that our financing will help Neuca meet its new facility needs."

Robert Dobrzycki, Managing Partner of Panattoni Europe, noted: "Choosing W. P. Carey as our funding source enabled us to focus on the needs and timing of the project, avoid the risks of relying on short-term borrowing and the process of securing a forward-purchaser, all while eliminating any equity outlay on our part." Sphere: Related Content

AMF Bowling Completes £15.2 Million Sale Leaseback of Nine Family Entertainment Centers in UK

Property Magazine International - August 16, 2010

Columbus UK Real Estate Fund, advised by Columbus Capital Management, has completed a purchase and leaseback of nine family entertainment centres from AMF Bowling. This combined with an equity investment from Close Brothers Private Equity (CBPE Capital), has financed AMF’s simultaneous acquisition of its main rival, Hollywood Bowl, from Mitchells and Butler plc.

AMF has acquired the 24 Hollywood Bowl centres for £27 million which, together with the existing 18 AMF centres makes the combined AMF Hollywood business the UK market leader with 42 prime sites across the UK. The AMF management team is highly regarded in the sector and is backed by the shareholders of Bourne Leisure, the owner of Butlins and Haven Holidays.

The nine centres acquired by Columbus range in size from 20,000 sq ft to 30,000 sq ft and are all situated on retail parks or major arterial roads. They are located in Ashford, Maidstone, Torquay, Peterborough, Wellingborough, Shrewsbury, Wigan, Carlisle and Stirling. The units have all been leased back to the combined AMF Hollywood Bowl business for 25 years at an average rent of approximately £6 per sq ft with rent reviews geared to the RPI Index.

The price of approximately £15.2 million reflects an initial yield of 9.3%.

Douglas Stevens & Co and Chester Properties advised Columbus Capital whilst Montague Evans acted for AMF Bowling. Sphere: Related Content