PropertyEU - February 26, 2010
Spanish supermarket group Eroski is near to concluding further sale-and-leaseback transactions of property assets following on from the recent EUR 74 mln disposal of supermarkets to US investor WP Carey, PropertyEU has learned.
Cushman & Wakefield, which is advising Eroski, confirmed that several transactions are in due diligence but it would not comment on the size of the potential deals or provide further details. Rupert Lea, a partner in C&W's Madrid office, said, however, that the players in the prospective deals are international investors, but added that UK investment company Topland and WP Carey, the US sale-and-leaseback specialist, are not involved.
In early February WP Carey completed a two-stage sale-and-leaseback transaction with Eroski. The second tranche, totalling EUR 36 mln, was for the purchase of 16 retail facilities from the Spanish supermarket operator. The first tranche, totalling EUR 38 mln and comprising 13 sites, closed in December 2009. German lender Eurohypo provided financing for the deal.
Topland carried out a two-phase sale-and-leaseback with Eroski totalling about EUR 710 mln in late 2008 and early 2009.
Sphere: Related Content
Sunday, February 28, 2010
Landes Group Acquires 313 CVS Pharmacy Stores for $1.375 Billion in 2009
PRWeb - February 24, 2010
Landes Investment Group, Inc. (the “Landes Group”), a privately held real estate investment and development company, announced today that it has acquired a total of 313 CVS pharmacy properties valued at $1.375 billion. The acquisition of the properties, located in 33 states, came via three separate deals in 2009, the last of which was completed in mid-December 2009.
“Last year was an extremely difficult time for many businesses, so we’re pleased that we were able to acquire these properties at competitive rates in the midst of a challenging economy when so few transactions were being done,” says Brett Landes, the company’s founder and president. “The fact that we were able to have such a successful year speaks to the strength of our relationship with CVS, as well as our reputation and history.”
The Landes Group purchased the properties from CVS as sale-and-leaseback transactions, by which the company buys land and buildings from CVS, then leases them back over a long term. The first round of transactions was completed in June 2009 for 122 properties valued at approximately $495 million; the second round closed in September 2009 for 25 properties valued at $137 million; and the third round was completed in December 2009 for 166 properties valued at $743 million.
The deals were closed through LLWG Capital, Inc., a related entity of which Landes is President. Barclays Capital, a global financial services provider, was the primary investment banker for the deals. Liechty & McGinnis, LLP served as advisor and legal counsel on the transactions. Sphere: Related Content
Landes Investment Group, Inc. (the “Landes Group”), a privately held real estate investment and development company, announced today that it has acquired a total of 313 CVS pharmacy properties valued at $1.375 billion. The acquisition of the properties, located in 33 states, came via three separate deals in 2009, the last of which was completed in mid-December 2009.
“Last year was an extremely difficult time for many businesses, so we’re pleased that we were able to acquire these properties at competitive rates in the midst of a challenging economy when so few transactions were being done,” says Brett Landes, the company’s founder and president. “The fact that we were able to have such a successful year speaks to the strength of our relationship with CVS, as well as our reputation and history.”
The Landes Group purchased the properties from CVS as sale-and-leaseback transactions, by which the company buys land and buildings from CVS, then leases them back over a long term. The first round of transactions was completed in June 2009 for 122 properties valued at approximately $495 million; the second round closed in September 2009 for 25 properties valued at $137 million; and the third round was completed in December 2009 for 166 properties valued at $743 million.
The deals were closed through LLWG Capital, Inc., a related entity of which Landes is President. Barclays Capital, a global financial services provider, was the primary investment banker for the deals. Liechty & McGinnis, LLP served as advisor and legal counsel on the transactions. Sphere: Related Content
Sunday, February 21, 2010
Royal Mail Seeking £500 Million Sale Leaseback of UK Mail Sorting Facilities
The Independent - February 21, 2010
Royal Mail is planning to raise an estimated £500m by selling up to half its mail sorting centres.
King Sturge, a property agent, has been asked to sell three centres in Warrington, Northampton and Manchester to test the market. It is hoped these will raise around £50m, with 25 to 35 centres in total likely to be sold off over the next 12 months.
Under the sale-and-leaseback arrangement, the centres would be bought and run by property companies, while Royal Mail would rent them back for 20 years. The sales would be one of the last big moves by outgoing chief executive Adam Crozier, whose controversial policies to reform the company have included closing thousands of post office branches and cutting jobs.
Mr Crozier is joining broadcaster ITV as chief executive later this year.
King Sturge declined to comment. Royal Mail did not contradict the story but a spokeswoman insisted: "We are committed to, and investing in, these sites for the long-term and have no plans whatsoever to vacate them." Sphere: Related Content
Royal Mail is planning to raise an estimated £500m by selling up to half its mail sorting centres.
King Sturge, a property agent, has been asked to sell three centres in Warrington, Northampton and Manchester to test the market. It is hoped these will raise around £50m, with 25 to 35 centres in total likely to be sold off over the next 12 months.
Under the sale-and-leaseback arrangement, the centres would be bought and run by property companies, while Royal Mail would rent them back for 20 years. The sales would be one of the last big moves by outgoing chief executive Adam Crozier, whose controversial policies to reform the company have included closing thousands of post office branches and cutting jobs.
Mr Crozier is joining broadcaster ITV as chief executive later this year.
King Sturge declined to comment. Royal Mail did not contradict the story but a spokeswoman insisted: "We are committed to, and investing in, these sites for the long-term and have no plans whatsoever to vacate them." Sphere: Related Content
Saturday, February 20, 2010
Eroski Completes $50 Million Sale leaseback of 16 Supermarkets in Spain
Property Funds World - February 18, 2010
W. P. Carey’s real estate investment trust affiliate CPA:17 – Global has completed the second tranche of a EUR74m (USD104m) corporate sale leaseback transaction with Eroski Sociedad Cooperativa.
The second tranche, totalling EUR36m (USD50m), is for the purchase of 16 retail facilities from the Spanish supermarket operator.
The first tranche, totalling EUR38m (USD54m) and comprising 13 sites, closed in December last year.
The properties are leased to Eroski under a long term lease. Financing for the investment was provided by Eurohypo.
Established in 1969, Eroski is the third largest food and consumables retailer in Spain. It operates more than 100 hypermarkets and 1,200 supermarkets, franchises over 500 Aliprox fast-food outlets, and manages gas stations, drugstores and travel agencies.
Eroski is the latest European retailer, following transactions with Tesco, OBI and Hellweg, to partner with W. P. Carey in order to release capital from their real estate.
Jeffrey Lefleur (pictured), executive director of W. P. Carey, says: "The closing of this financing further demonstrates W. P. Carey's ability to provide sale-leaseback financing in Spain and highlights our goal of providing defensive, risk management-driven investments for our investors in a breadth of different companies throughout Europe. Our global investment strategy and depth of capital resources will allow us to continue to provide long term financing to corporate real estate owners at a time when more traditional sources of financing are not available." Sphere: Related Content
W. P. Carey’s real estate investment trust affiliate CPA:17 – Global has completed the second tranche of a EUR74m (USD104m) corporate sale leaseback transaction with Eroski Sociedad Cooperativa.
The second tranche, totalling EUR36m (USD50m), is for the purchase of 16 retail facilities from the Spanish supermarket operator.
The first tranche, totalling EUR38m (USD54m) and comprising 13 sites, closed in December last year.
The properties are leased to Eroski under a long term lease. Financing for the investment was provided by Eurohypo.
Established in 1969, Eroski is the third largest food and consumables retailer in Spain. It operates more than 100 hypermarkets and 1,200 supermarkets, franchises over 500 Aliprox fast-food outlets, and manages gas stations, drugstores and travel agencies.
Eroski is the latest European retailer, following transactions with Tesco, OBI and Hellweg, to partner with W. P. Carey in order to release capital from their real estate.
Jeffrey Lefleur (pictured), executive director of W. P. Carey, says: "The closing of this financing further demonstrates W. P. Carey's ability to provide sale-leaseback financing in Spain and highlights our goal of providing defensive, risk management-driven investments for our investors in a breadth of different companies throughout Europe. Our global investment strategy and depth of capital resources will allow us to continue to provide long term financing to corporate real estate owners at a time when more traditional sources of financing are not available." Sphere: Related Content
Eroski Closes $51 Million Sale Leaseback of 13 Supermarkets in Spain
IDD Magazine - December 23, 2009
W.P. Carey & Co. announced Wednesday that one of its REITs, CPA:17 -- Global, completed its first sale-leaseback transaction in Spain.
The deal involved the acquisition of a 13-facility supermarket portfolio from Spanish supermarket operator Eroski Sociedad Cooperativa for $51 million in cash.
The supermarkets are being leased back to Eroski, Spain's third-largest food and consumables retailer, on a long-term basis. A spokesman for W.P. Carey tells IDD the lease period falls within the firm's typical 15-25-year time frame, and W.P. Carey's ability to pay in cash was a major reason the deal was able to close by year-end.
"The Eroski acquisition represents an opportunity to enter the Spanish market by investing in well-located retail locations leased to an established brand-name retailer," Jeffrey Lefleur, a W.P. Carey executive director, said in a press release. "In addition, the acquisition is consistent with W.P. Carey's investment strategy of purchasing mission-critical assets that also provide industry and geographical diversification to our investment portfolio."
W.P. Carey specializes in sale-leasebacks, having completed two deals in the U.S. two weeks ago. The firm's spokesman says W.P. Carey usually engages in sale-leaseback transactions with companies in the midst of restructuring processes.
In the case of Eroski, the Basque Country-headquartered company reached an agreement earlier this week with 23 lenders to restructure its debt into one $2.4 billion loan, which is due to mature in January 2014. Goldman Sachs has been advising Eroski on its debt restructuring.
Cushman & Wakefield partner Rupert Lea and associate Yola Camacho represented Eroski on the sale-leaseback transaction. Sphere: Related Content
W.P. Carey & Co. announced Wednesday that one of its REITs, CPA:17 -- Global, completed its first sale-leaseback transaction in Spain.
The deal involved the acquisition of a 13-facility supermarket portfolio from Spanish supermarket operator Eroski Sociedad Cooperativa for $51 million in cash.
The supermarkets are being leased back to Eroski, Spain's third-largest food and consumables retailer, on a long-term basis. A spokesman for W.P. Carey tells IDD the lease period falls within the firm's typical 15-25-year time frame, and W.P. Carey's ability to pay in cash was a major reason the deal was able to close by year-end.
"The Eroski acquisition represents an opportunity to enter the Spanish market by investing in well-located retail locations leased to an established brand-name retailer," Jeffrey Lefleur, a W.P. Carey executive director, said in a press release. "In addition, the acquisition is consistent with W.P. Carey's investment strategy of purchasing mission-critical assets that also provide industry and geographical diversification to our investment portfolio."
W.P. Carey specializes in sale-leasebacks, having completed two deals in the U.S. two weeks ago. The firm's spokesman says W.P. Carey usually engages in sale-leaseback transactions with companies in the midst of restructuring processes.
In the case of Eroski, the Basque Country-headquartered company reached an agreement earlier this week with 23 lenders to restructure its debt into one $2.4 billion loan, which is due to mature in January 2014. Goldman Sachs has been advising Eroski on its debt restructuring.
Cushman & Wakefield partner Rupert Lea and associate Yola Camacho represented Eroski on the sale-leaseback transaction. Sphere: Related Content
Friday, February 19, 2010
Accor Completes EUR154 Million Sale Leaseback of Five Hotels in Europe
Accor Web Site - February 19, 2010
As part of the ongoing deployment of its “asset right” strategy, Accor has announced an international real estate transaction involving the sale of five hotels (representing more than 1,100 rooms) in four European countries for €154 million.
The transaction has been carried out with Invesco Real Estate, a major real estate manager in the United States, Europe and Asia, with assets under management of more than €18 billion, of which €650 million in European and US hotel properties. The transaction involves five hotels:
- The Novotel Muenchen City in Munich (307 rooms)
- The Novotel Roma la Rustica (149 rooms) and the Mercure Corso Trieste in Rome (97 rooms)
- The Mercure Zabatova in Bratislava, currently under construction (175 rooms)
- The Pullman Paris La Défense (384 rooms)
The Novotel and Mercure hotels have been sold under a sale and variable leaseback agreement for €74 million, of which €17 million for the Mercure Zabatova. They will continue to be operated by Accor under a 15-year variable-rent lease (corresponding to 22% of average annual revenue) that can be renewed at Accor’s initiative. Insurance, property taxes and structural maintenance costs will now be at the owner’s expense.
The Pullman Paris La Défense has been sold for €80 million, including a €10-million renovation program at the owner’s expense. The hotel will continue to be operated by Accor under a 12-year management contract that can be renewed six times.
Financially, the transaction enables Accor to reduce adjusted net debt by €93 million in 2010 and will have a neutral impact on operating profit before tax and non-recurring items.
The transaction confirms Accor’s ability to continue actively pursuing its “asset right” strategy, even in a difficult economic environment, with the goal of reducing earnings volatility and sharpening the focus on its core competency – hotel management. Sphere: Related Content
As part of the ongoing deployment of its “asset right” strategy, Accor has announced an international real estate transaction involving the sale of five hotels (representing more than 1,100 rooms) in four European countries for €154 million.
The transaction has been carried out with Invesco Real Estate, a major real estate manager in the United States, Europe and Asia, with assets under management of more than €18 billion, of which €650 million in European and US hotel properties. The transaction involves five hotels:
- The Novotel Muenchen City in Munich (307 rooms)
- The Novotel Roma la Rustica (149 rooms) and the Mercure Corso Trieste in Rome (97 rooms)
- The Mercure Zabatova in Bratislava, currently under construction (175 rooms)
- The Pullman Paris La Défense (384 rooms)
The Novotel and Mercure hotels have been sold under a sale and variable leaseback agreement for €74 million, of which €17 million for the Mercure Zabatova. They will continue to be operated by Accor under a 15-year variable-rent lease (corresponding to 22% of average annual revenue) that can be renewed at Accor’s initiative. Insurance, property taxes and structural maintenance costs will now be at the owner’s expense.
The Pullman Paris La Défense has been sold for €80 million, including a €10-million renovation program at the owner’s expense. The hotel will continue to be operated by Accor under a 12-year management contract that can be renewed six times.
Financially, the transaction enables Accor to reduce adjusted net debt by €93 million in 2010 and will have a neutral impact on operating profit before tax and non-recurring items.
The transaction confirms Accor’s ability to continue actively pursuing its “asset right” strategy, even in a difficult economic environment, with the goal of reducing earnings volatility and sharpening the focus on its core competency – hotel management. Sphere: Related Content
Sainsbury Agrees to £55 Million Sale Leaseback of Supermarket in West London
Property Week - February 12, 2010
Sainsbury’s has agreed a sale and leaseback with Aviva Investors in Hayes, west London.
The pair agreed to regear the long leasehold at the 125,000 sq ft Sainsbury’s supermarket and petrol filling station at Lombardy Retail Park.
Aviva paid £55m for the leasehold and Sainsbury’s agreed a rent linked to the Retail Prices Index.
The Sainsbury’s deal is one of the largest purchases of a single supermarket in the last five years and is further evidence of the number of institutions keen to buy supermarket assets.
Grocery sales have continued to rise, despite the recession.
Jones Lang LaSalle advised Sainsbury’s; Briant Champion Long advised Aviva. Sphere: Related Content
Sainsbury’s has agreed a sale and leaseback with Aviva Investors in Hayes, west London.
The pair agreed to regear the long leasehold at the 125,000 sq ft Sainsbury’s supermarket and petrol filling station at Lombardy Retail Park.
Aviva paid £55m for the leasehold and Sainsbury’s agreed a rent linked to the Retail Prices Index.
The Sainsbury’s deal is one of the largest purchases of a single supermarket in the last five years and is further evidence of the number of institutions keen to buy supermarket assets.
Grocery sales have continued to rise, despite the recession.
Jones Lang LaSalle advised Sainsbury’s; Briant Champion Long advised Aviva. Sphere: Related Content
Topland Seeking £200 Million for Net Leased Property Portfolio
Property Week - February 19, 2010
Topland plans to sell 20 assets to reinvest in larger corporate sale and leaseback deals.
The 20 UK assets across a range of sectors being sold include: a BUPA hospital on Gray’s Inn Road, WC1 for around £10m, an 84,000 sq ft City office at 51-55 Gresham Street, EC2 at £46.8m, which would reflect a yield of 7.5%; an 184,008 sq ft Royal Mail sorting and distribution centre in Plymouth at £14.7m, a 60,803 sq ft Call Centre let to Orange being marketed at £10.8m and a range of Budgens, Sainsbury, Somerfield and Tesco supermarkets priced between £3m and £8m.
Tom Betts, Topland’s director of structured finance, said: “There is currently strong demand for good covenants and longer term income driven by the institutions and equity rich investors. The properties are all at the smaller end of our portfolio but are in an attractive price range which banks can fund.
“Topland is currently focused on larger assets and corporate sale-and-leasebacks both in the UK and Europe.”
Cushman & Wakefield, Jones Lang LaSalle and Lewis & Partners are advising on sales.
Eddie Zakay is chairman of Topland’s UK-based operations. Sol Zakay is based in Topland Group’s headquarters in Gibraltar. Sphere: Related Content
Topland plans to sell 20 assets to reinvest in larger corporate sale and leaseback deals.
The 20 UK assets across a range of sectors being sold include: a BUPA hospital on Gray’s Inn Road, WC1 for around £10m, an 84,000 sq ft City office at 51-55 Gresham Street, EC2 at £46.8m, which would reflect a yield of 7.5%; an 184,008 sq ft Royal Mail sorting and distribution centre in Plymouth at £14.7m, a 60,803 sq ft Call Centre let to Orange being marketed at £10.8m and a range of Budgens, Sainsbury, Somerfield and Tesco supermarkets priced between £3m and £8m.
Tom Betts, Topland’s director of structured finance, said: “There is currently strong demand for good covenants and longer term income driven by the institutions and equity rich investors. The properties are all at the smaller end of our portfolio but are in an attractive price range which banks can fund.
“Topland is currently focused on larger assets and corporate sale-and-leasebacks both in the UK and Europe.”
Cushman & Wakefield, Jones Lang LaSalle and Lewis & Partners are advising on sales.
Eddie Zakay is chairman of Topland’s UK-based operations. Sol Zakay is based in Topland Group’s headquarters in Gibraltar. Sphere: Related Content
Thursday, February 18, 2010
Imagine Schools Closes $61 Million Sale Leaseback of Seven Charter Schools
GlobeSt.com - February 16, 2010
Inland Public Properties Development Inc, a subsidiary of Inland American Real Estate Investment Trust Inc., has purchased seven charter schools for $61 million. The sales-leaseback deal includes schools managed by Imagine Schools Inc.
Inland officials say this deal is innovative in the way it involves both the public and private sector.
“This innovative transaction allows Imagine to focus on its critical mission of public student education and development, while we focus on providing the capital for the bricks and mortar,” says Chuck Jones, president and CEO of IPPD. “We think this is the true definition of a public-private partnership, and one that positions IPPD for continued growth in the social infrastructure community.”
The seven charter schools are located in Arizona, Colorado, Florida, Maryland, and Washington, DC. Imagine will lease back the schools for 20 years on a triple-net master lease. The rental rate on the deal was not disclosed.
“This transaction demonstrates our commitment to social infrastructure assets, which are stable, income producing properties supported by state and federal funding programs,” says Lori Foust, CFO of Inland American Business Manager & Advisor Inc. “These charter schools are strong additions to Inland American’s diverse portfolio.”
Imagine has 71 public charter schools educating more than 36,000 children in 11 states and Washington, DC. Sphere: Related Content
Inland Public Properties Development Inc, a subsidiary of Inland American Real Estate Investment Trust Inc., has purchased seven charter schools for $61 million. The sales-leaseback deal includes schools managed by Imagine Schools Inc.
Inland officials say this deal is innovative in the way it involves both the public and private sector.
“This innovative transaction allows Imagine to focus on its critical mission of public student education and development, while we focus on providing the capital for the bricks and mortar,” says Chuck Jones, president and CEO of IPPD. “We think this is the true definition of a public-private partnership, and one that positions IPPD for continued growth in the social infrastructure community.”
The seven charter schools are located in Arizona, Colorado, Florida, Maryland, and Washington, DC. Imagine will lease back the schools for 20 years on a triple-net master lease. The rental rate on the deal was not disclosed.
“This transaction demonstrates our commitment to social infrastructure assets, which are stable, income producing properties supported by state and federal funding programs,” says Lori Foust, CFO of Inland American Business Manager & Advisor Inc. “These charter schools are strong additions to Inland American’s diverse portfolio.”
Imagine has 71 public charter schools educating more than 36,000 children in 11 states and Washington, DC. Sphere: Related Content
Wednesday, February 17, 2010
Imagine Schools Enters $44 Million Sale Leaseback of Five Charter Schools
Kansas City Business Journal - January 22, 2010
Entertainment Properties Trust has increased its investment in public charter schools by $48 million, the company said Friday.
The company (NYSE: EPR) purchased five new charter schools from Imagine Schools Inc. of Arlington, Va., at a cost of $44 million and agreed to finance expansion of two others at a cost of $4 million.
Entertainment Properties Trust, which is based in Kansas City, will lease the five new schools back to Imagine Schools, a leading operator of public charter schools.
Entertainment Properties Trust’s portfolio now includes 27 charter schools that Imagine Schools operates in nine states and the District of Columbia.
“We are excited to add to our public charter school portfolio and enthusiastic about the prospects of Imagine and this investment category,” Entertainment Properties Trust CEO David Brain said in a release.
In an interview, Brain said the Imagine Schools transaction announced Friday fulfilled Entertainment Properties’ 2007 commitment to make at least $200 million worth of acquisitions from Imagine. It also increases Entertainment Properties’ footprint in what Brain called “a huge new category” for private real estate investment.
“Public charter schools are now a 4 or 5 percent slice of a couple trillion dollar public education real estate market,” Brain said.
Heretofore, new public schools have been financed almost exclusively through school-bond issues, he said. But Brain said the move to “decentralize and debureaucratize public education” is creating an increasing number of charter schools, which aren’t as cost-efficiently financed through bond issues.
The five new charter schools purchased by Entertainment Properties contain more than 357,000 square feet of educational space and have an enrollment in excess of 2,600 students. All of the Imagine schools owned by Entertainment Properties are governed by a triple-net master lease with a 25-year primary term. Sphere: Related Content
Entertainment Properties Trust has increased its investment in public charter schools by $48 million, the company said Friday.
The company (NYSE: EPR) purchased five new charter schools from Imagine Schools Inc. of Arlington, Va., at a cost of $44 million and agreed to finance expansion of two others at a cost of $4 million.
Entertainment Properties Trust, which is based in Kansas City, will lease the five new schools back to Imagine Schools, a leading operator of public charter schools.
Entertainment Properties Trust’s portfolio now includes 27 charter schools that Imagine Schools operates in nine states and the District of Columbia.
“We are excited to add to our public charter school portfolio and enthusiastic about the prospects of Imagine and this investment category,” Entertainment Properties Trust CEO David Brain said in a release.
In an interview, Brain said the Imagine Schools transaction announced Friday fulfilled Entertainment Properties’ 2007 commitment to make at least $200 million worth of acquisitions from Imagine. It also increases Entertainment Properties’ footprint in what Brain called “a huge new category” for private real estate investment.
“Public charter schools are now a 4 or 5 percent slice of a couple trillion dollar public education real estate market,” Brain said.
Heretofore, new public schools have been financed almost exclusively through school-bond issues, he said. But Brain said the move to “decentralize and debureaucratize public education” is creating an increasing number of charter schools, which aren’t as cost-efficiently financed through bond issues.
The five new charter schools purchased by Entertainment Properties contain more than 357,000 square feet of educational space and have an enrollment in excess of 2,600 students. All of the Imagine schools owned by Entertainment Properties are governed by a triple-net master lease with a 25-year primary term. Sphere: Related Content
Wednesday, February 10, 2010
Legal & General Launches £500 Million Net Leased UK Property Fund
Property Funds World - February 8, 2010
Legal & General Property has launched the LPI (Limited Price Inflation) Income Property Fund, which aims to offer defined benefit pension schemes a way to invest in property coupled with a secure source of income, primarily government-backed, all with inflation-linkage.
Providing pension investors with an alternative to traditional index-linked gilts and bonds, which produce average real yields of around 1.5 per cent, the fund aims to deliver a real) yield in excess of four per cent per annum.
To achieve this, the portfolio will be structured around properties whose value is predominantly derived from their leases.
The fund will hold assets which will primarily be let to government or quasi-government tenants for a minimum of 20 years, with their income streams linked to inflation. These assets provide secure, inflation-linked income streams ideally suited for pension fund investors, combined with significantly lower volatility than would be expected from a typical property fund.
The fund will take advantage of the sale-and-leaseback assets currently being offered to LGP through its access to on and off-market opportunities, leveraging its in-house property expertise and relationships with banks and public sector bodies.
The fund will be diversified both by sector class and geography across the UK and will have a target size of GBP500m, with no gearing, either direct or indirect.
Michael Barrie (pictured), director of balanced funds at Legal & General Property, says: “Offering a new innovative approach to pension investors looking for a secure higher yield alternative to long-dated index linked bonds, the Fund combines liability matching with reduced volatility, based on inflation-linked income streams.
“Although the capital values have recovered strongly in recent months, the yield gap between inflation-linked properties and equivalent index-linked gilts offers a very attractive opportunity to our investors. It may be some while before rental levels in the UK begin to recover and many investors will prefer an income stream that rises with inflation over one that is linked to the underlying occupier market.” Sphere: Related Content
Legal & General Property has launched the LPI (Limited Price Inflation) Income Property Fund, which aims to offer defined benefit pension schemes a way to invest in property coupled with a secure source of income, primarily government-backed, all with inflation-linkage.
Providing pension investors with an alternative to traditional index-linked gilts and bonds, which produce average real yields of around 1.5 per cent, the fund aims to deliver a real) yield in excess of four per cent per annum.
To achieve this, the portfolio will be structured around properties whose value is predominantly derived from their leases.
The fund will hold assets which will primarily be let to government or quasi-government tenants for a minimum of 20 years, with their income streams linked to inflation. These assets provide secure, inflation-linked income streams ideally suited for pension fund investors, combined with significantly lower volatility than would be expected from a typical property fund.
The fund will take advantage of the sale-and-leaseback assets currently being offered to LGP through its access to on and off-market opportunities, leveraging its in-house property expertise and relationships with banks and public sector bodies.
The fund will be diversified both by sector class and geography across the UK and will have a target size of GBP500m, with no gearing, either direct or indirect.
Michael Barrie (pictured), director of balanced funds at Legal & General Property, says: “Offering a new innovative approach to pension investors looking for a secure higher yield alternative to long-dated index linked bonds, the Fund combines liability matching with reduced volatility, based on inflation-linked income streams.
“Although the capital values have recovered strongly in recent months, the yield gap between inflation-linked properties and equivalent index-linked gilts offers a very attractive opportunity to our investors. It may be some while before rental levels in the UK begin to recover and many investors will prefer an income stream that rises with inflation over one that is linked to the underlying occupier market.” Sphere: Related Content
Arizona House OKs Additional $300 Million Sale Leaseback of State Buildings
Arizona Daily Star - February 10, 2010
Without a vote to spare, the House on Tuesday gave final approval to putting the state in debt for the next 20 years to balance the books this year.
The 31-27 vote came over objections by lawmakers from both parties who had different reasons they did not like the plan. But a majority said they saw little alternative.
Rep. Nancy McLain, R-Bullhead City, said the state's position is not unlike one she faced during the recession of the early 1990s with her janitorial firm.
First she and her husband stopped taking a salary, then borrowed against a bank line of credit until that was exhausted, then maxed out the credit cards, just to stay afloat, she said.
Rep. Bill Konopnicki, R-Safford, said he also has run into situations as the owner of McDonald's restaurant franchises, and recognizes there is a place for debt. But this is excessive.
"Never, never, never do you take a 20-year note to meet payroll," he said. "This is absolutely, totally irresponsible."
The measure, which now goes to the governor, orders the sale of another $300 million in state buildings, which the state will lease back for 20 years. At the end of that time, ownership will revert back to the state.
It also calls for borrowing $450 million outright for the next 20 years. To get around the constitutional limit on state debt, repayment will come from future lottery proceeds, not the state general fund.
Those moves still leave the state with a $450 million gap. A measure, already approved by the Senate, would delay making a $350 million payment due to public schools in April until the next fiscal year, and would defer $100 million in aid to the state's three universities.
House Republican leaders put off bringing that issue to the floor because they were unsure they could get the necessary 31 votes for final approval of that plan.
This won't be the first state building sell-off. It already sold off $735 million worth of buildings last month in a similar deal to generate immediate cash.
In addition to those measures, the House and Senate have previously approved asking voters for a temporary 1-cent-per-dollar hike in state sales taxes. But even if that measure is approved on May 18, the revenues won't flow into the treasury quickly enough to help balance the budget for the fiscal year that ends June 30. Sphere: Related Content
Without a vote to spare, the House on Tuesday gave final approval to putting the state in debt for the next 20 years to balance the books this year.
The 31-27 vote came over objections by lawmakers from both parties who had different reasons they did not like the plan. But a majority said they saw little alternative.
Rep. Nancy McLain, R-Bullhead City, said the state's position is not unlike one she faced during the recession of the early 1990s with her janitorial firm.
First she and her husband stopped taking a salary, then borrowed against a bank line of credit until that was exhausted, then maxed out the credit cards, just to stay afloat, she said.
Rep. Bill Konopnicki, R-Safford, said he also has run into situations as the owner of McDonald's restaurant franchises, and recognizes there is a place for debt. But this is excessive.
"Never, never, never do you take a 20-year note to meet payroll," he said. "This is absolutely, totally irresponsible."
The measure, which now goes to the governor, orders the sale of another $300 million in state buildings, which the state will lease back for 20 years. At the end of that time, ownership will revert back to the state.
It also calls for borrowing $450 million outright for the next 20 years. To get around the constitutional limit on state debt, repayment will come from future lottery proceeds, not the state general fund.
Those moves still leave the state with a $450 million gap. A measure, already approved by the Senate, would delay making a $350 million payment due to public schools in April until the next fiscal year, and would defer $100 million in aid to the state's three universities.
House Republican leaders put off bringing that issue to the floor because they were unsure they could get the necessary 31 votes for final approval of that plan.
This won't be the first state building sell-off. It already sold off $735 million worth of buildings last month in a similar deal to generate immediate cash.
In addition to those measures, the House and Senate have previously approved asking voters for a temporary 1-cent-per-dollar hike in state sales taxes. But even if that measure is approved on May 18, the revenues won't flow into the treasury quickly enough to help balance the budget for the fiscal year that ends June 30. Sphere: Related Content
Monday, February 08, 2010
Ballard Power Agrees to $19.5 Million Sale Leaseback of Canadian HQ
Ballard Power Web Site - February 8, 2010
Ballard Power Systems (TSX: BLD; NASDAQ: BLDP) announced that it has entered into a sale-and-leaseback agreement with Madison Pacific Properties Inc. (TSX: MPC) (www.madisonpacific.ca). Ballard will sell its head office building site in Burnaby, British Columbia in return for gross cash proceeds of approximately C$20.8 million (US$19.5 million). The company will also enter into an initial fifteen-year lease agreement for the same property. The transaction is expected to close on March 9, 2010.
Bruce Cousins, Ballard's Chief Financial Officer, said, "This transaction presented an opportunity to extract cash from a non-core asset and further fortify our strong balance sheet, augmenting the company's cash reserves to approximately $100 million. At the same time, Ballard's continued use of the site is secured through a long-term lease arrangement."
John Sheridan, Ballard's President & CEO, added, "This transaction, along with the monetization of our Share Purchase Agreement and our progress in market development in 2009, has positioned Ballard for strong performance in 2010. We continue to expect revenue growth in excess of 35% and improved cash flow from operations by 30% in 2010, and positive EBITDA performance during 2011." Sphere: Related Content
Ballard Power Systems (TSX: BLD; NASDAQ: BLDP) announced that it has entered into a sale-and-leaseback agreement with Madison Pacific Properties Inc. (TSX: MPC) (www.madisonpacific.ca). Ballard will sell its head office building site in Burnaby, British Columbia in return for gross cash proceeds of approximately C$20.8 million (US$19.5 million). The company will also enter into an initial fifteen-year lease agreement for the same property. The transaction is expected to close on March 9, 2010.
Bruce Cousins, Ballard's Chief Financial Officer, said, "This transaction presented an opportunity to extract cash from a non-core asset and further fortify our strong balance sheet, augmenting the company's cash reserves to approximately $100 million. At the same time, Ballard's continued use of the site is secured through a long-term lease arrangement."
John Sheridan, Ballard's President & CEO, added, "This transaction, along with the monetization of our Share Purchase Agreement and our progress in market development in 2009, has positioned Ballard for strong performance in 2010. We continue to expect revenue growth in excess of 35% and improved cash flow from operations by 30% in 2010, and positive EBITDA performance during 2011." Sphere: Related Content
Saturday, February 06, 2010
CWT Nearing $445 Million Sale Leaseback of Two Logistics Facilities in Singapore
The Business Times - February 2, 2010
Logistics group CWT Limited has proposed the sale and leaseback of two of its logistics facilities in a deal worth $445 million (US $313 million.)
CWT will sell CWT Commodity Hub and CWT Cold Hub to Cache Logistics Trust, for the purposes of Cache's eventual public listing as Asia's first logistics-focused real estate investment trust.
Cache, whose setting up is subject to regulatory approval, will be managed by ARA-CWT Trust Management (Cache) Limited. CWT will have a 40 per cent stake in the manager. The remaining stake will be held by ARA Asset Management Limited - a real estate fund manager tied to Hong Kong tycoon Li Ka-shing's Cheung Kong group.
The trust's property manager will be Cache Property Management Pte Ltd. CWT will have a 60 per cent stake in the property manager and the remaining 40 per cent stake will be held by ARA.
CWT said it will book a one-off gain of $157.7 million from the sale of the two logistics facilities, which are valued at $443 million. They are part of CWT's primary assets, located close to PSA Terminals, major ports and Singapore's central business district.
Cache will pay $445 million for the two facilities, of which $65 million will be settled in the form of Cache units. The rest will be paid for in cash.
CWT will use the sale proceeds to expand its logistics business and to settle its outstanding borrowings early, which it says will result in a significant boost to the group's financial muscle and competitiveness in the region.
In its statement yesterday, CWT also explained that Cache will be the first of its kind in Asia to capitalise on the positive outlook of the global logistics sector and the synergistic business models of CWT and Cache.
Cache holds an investment mandate that targets logistics properties in the Asia-Pacific region, with an initial portfolio of six logistics properties in Singapore, including CWT Commodity Hub and CWT Cold Hub.
CWT said Cache is expected to leverage on the rights of first refusal granted by CWT and the strengths of CWT to 'pursue yield-accretive acquisitions to achieve long term, regular and predictable distributable income for unitholders'.
Loi Pok Yen, group CEO of CWT, said: 'The creation of CLT (Cache) to invest in yield-accretive logistics properties in Asia is a historic milestone and enables CWT to own a capital-efficient asset-owning vehicle to complement our core logistics business operations as well as enhance the group's ability to expand its business regionally and globally.'
'In addition, the sale and leaseback will enable the group to participate in CLT through its holdings of Cache units and derive a stable income stream from CLT's distributions,' he said.
CWT is the largest listed logistics company in South-east Asia, offering integrated logistics solutions to the chemicals, commodities, automotive, marine, oil & gas, defence and industrial sectors. Sphere: Related Content
Logistics group CWT Limited has proposed the sale and leaseback of two of its logistics facilities in a deal worth $445 million (US $313 million.)
CWT will sell CWT Commodity Hub and CWT Cold Hub to Cache Logistics Trust, for the purposes of Cache's eventual public listing as Asia's first logistics-focused real estate investment trust.
Cache, whose setting up is subject to regulatory approval, will be managed by ARA-CWT Trust Management (Cache) Limited. CWT will have a 40 per cent stake in the manager. The remaining stake will be held by ARA Asset Management Limited - a real estate fund manager tied to Hong Kong tycoon Li Ka-shing's Cheung Kong group.
The trust's property manager will be Cache Property Management Pte Ltd. CWT will have a 60 per cent stake in the property manager and the remaining 40 per cent stake will be held by ARA.
CWT said it will book a one-off gain of $157.7 million from the sale of the two logistics facilities, which are valued at $443 million. They are part of CWT's primary assets, located close to PSA Terminals, major ports and Singapore's central business district.
Cache will pay $445 million for the two facilities, of which $65 million will be settled in the form of Cache units. The rest will be paid for in cash.
CWT will use the sale proceeds to expand its logistics business and to settle its outstanding borrowings early, which it says will result in a significant boost to the group's financial muscle and competitiveness in the region.
In its statement yesterday, CWT also explained that Cache will be the first of its kind in Asia to capitalise on the positive outlook of the global logistics sector and the synergistic business models of CWT and Cache.
Cache holds an investment mandate that targets logistics properties in the Asia-Pacific region, with an initial portfolio of six logistics properties in Singapore, including CWT Commodity Hub and CWT Cold Hub.
CWT said Cache is expected to leverage on the rights of first refusal granted by CWT and the strengths of CWT to 'pursue yield-accretive acquisitions to achieve long term, regular and predictable distributable income for unitholders'.
Loi Pok Yen, group CEO of CWT, said: 'The creation of CLT (Cache) to invest in yield-accretive logistics properties in Asia is a historic milestone and enables CWT to own a capital-efficient asset-owning vehicle to complement our core logistics business operations as well as enhance the group's ability to expand its business regionally and globally.'
'In addition, the sale and leaseback will enable the group to participate in CLT through its holdings of Cache units and derive a stable income stream from CLT's distributions,' he said.
CWT is the largest listed logistics company in South-east Asia, offering integrated logistics solutions to the chemicals, commodities, automotive, marine, oil & gas, defence and industrial sectors. Sphere: Related Content
Wednesday, February 03, 2010
AIB Seeking €40m Sale Leaseback of 23 Bank Branches in Ireland
The Irish Times - February 3, 2010
With the serious scarcity of funds still hampering the banking system, AIB looks set to raise more than €40 million from the sale of 23 bank branches in Dublin and the provinces.
Sale and leaseback terms have been agreed on 11 of the buildings and contracts are due to be exchanged in the next three weeks on the remaining 12 branches.
Yields generally for the new owners will be between 7 per cent and 7.5 per cent.
Ever since AIB first started offloading branches in the autumn of 2006 it has used three different estate agents to sell them through high profile campaigns.
However, on this occasion it commissioned Davy, the stockbrokers, to market the 23 branches among its wealthy investor clients.
The decision to go for a low key campaign is thought to have been prompted by a desire to keep the sale out of the public realm at such a difficult time for the banking sector.
On Monday the bank refused to acknowledge that it was in the process of selling another tranche of its 182 branches.
“We have no comment to make,” a spokesman said.
The 11 branches about to be sold range in value from €580,000 for a building in Kenmare, Co Kerry, to one in Capel Street, Dublin 1, at €4.2 million. The yield in this case will be 7.25 per cent, marginally better than for the Kerry property.
Other branch sales being handled by Davy include buildings in Dalkey and Sutton in Dublin as well as Castlebar, Leixlip, Celbridge, Portlaoise, Cavan, Tullamore, Carlow and Enniscorthy.
A banking source said all the branches are to be bought by cash customers – “when the music stopped they happened to be on the right side of the trade”.
Funds on deposit with banks in Ireland currently exceed €280 billion, according to the latest quarterly report from the Central Bank.
AIB does not help finance the purchase of any part of its network of branches as a matter of policy. Most of the 50 branches sold over the past three-and-a-half years were bought by local investors, some of whom cherish the kudos of owning their local branch.
The most valuable of the bank buildings sold in 2006 showed an initial yield of 2.8 per cent. The returns to investors have rapidly increased with each subsequent sale in line with the stronger yields available in the investment market generally.
Like the previous branches sold, the 23 buildings being handled by Davy will be secured by long term leases for a period of 20 years with a break option in year 15.
The leases will also be subject to five yearly rent reviews. Sphere: Related Content
With the serious scarcity of funds still hampering the banking system, AIB looks set to raise more than €40 million from the sale of 23 bank branches in Dublin and the provinces.
Sale and leaseback terms have been agreed on 11 of the buildings and contracts are due to be exchanged in the next three weeks on the remaining 12 branches.
Yields generally for the new owners will be between 7 per cent and 7.5 per cent.
Ever since AIB first started offloading branches in the autumn of 2006 it has used three different estate agents to sell them through high profile campaigns.
However, on this occasion it commissioned Davy, the stockbrokers, to market the 23 branches among its wealthy investor clients.
The decision to go for a low key campaign is thought to have been prompted by a desire to keep the sale out of the public realm at such a difficult time for the banking sector.
On Monday the bank refused to acknowledge that it was in the process of selling another tranche of its 182 branches.
“We have no comment to make,” a spokesman said.
The 11 branches about to be sold range in value from €580,000 for a building in Kenmare, Co Kerry, to one in Capel Street, Dublin 1, at €4.2 million. The yield in this case will be 7.25 per cent, marginally better than for the Kerry property.
Other branch sales being handled by Davy include buildings in Dalkey and Sutton in Dublin as well as Castlebar, Leixlip, Celbridge, Portlaoise, Cavan, Tullamore, Carlow and Enniscorthy.
A banking source said all the branches are to be bought by cash customers – “when the music stopped they happened to be on the right side of the trade”.
Funds on deposit with banks in Ireland currently exceed €280 billion, according to the latest quarterly report from the Central Bank.
AIB does not help finance the purchase of any part of its network of branches as a matter of policy. Most of the 50 branches sold over the past three-and-a-half years were bought by local investors, some of whom cherish the kudos of owning their local branch.
The most valuable of the bank buildings sold in 2006 showed an initial yield of 2.8 per cent. The returns to investors have rapidly increased with each subsequent sale in line with the stronger yields available in the investment market generally.
Like the previous branches sold, the 23 buildings being handled by Davy will be secured by long term leases for a period of 20 years with a break option in year 15.
The leases will also be subject to five yearly rent reviews. Sphere: Related Content
Monday, February 01, 2010
Hanesbrands Enters $23.5 Million Sale Leaseback of Distribution Center in NC
The Business Journal of the Greater Triad Area - January 29, 2010
A Pennsylvania investment firm has bought a Hanesbrands Inc. distribution center for $23.5 million and will lease it back to the apparel maker.
Winston-Salem-based Hanesbrands recently sold its 930,451-square-foot distribution center in the Northridge Business Park off of U.S. 52 in Rural Hall, to Winston-Salem NC Associates LP, according to Forsyth County real estate records.
Winston-Salem NC Associates is owned by Blue Bell, Penn.-based Capital Solutions Inc. Fran Donato, principal at Capital Solutions, declined to discuss the details of the deal, but said the purchase is being financed by a combination of company funds and bank loans.
Matt Hall, Hanesbrands spokesman, said that the deal allows Hanesbrands to lease the building for the next 12 years while continuing to operate the distribution center. He declined to provide the lease terms. Sphere: Related Content
A Pennsylvania investment firm has bought a Hanesbrands Inc. distribution center for $23.5 million and will lease it back to the apparel maker.
Winston-Salem-based Hanesbrands recently sold its 930,451-square-foot distribution center in the Northridge Business Park off of U.S. 52 in Rural Hall, to Winston-Salem NC Associates LP, according to Forsyth County real estate records.
Winston-Salem NC Associates is owned by Blue Bell, Penn.-based Capital Solutions Inc. Fran Donato, principal at Capital Solutions, declined to discuss the details of the deal, but said the purchase is being financed by a combination of company funds and bank loans.
Matt Hall, Hanesbrands spokesman, said that the deal allows Hanesbrands to lease the building for the next 12 years while continuing to operate the distribution center. He declined to provide the lease terms. Sphere: Related Content
RBS Considering £500 Million Sale Leaseback of HQ Near Edinburgh
Telegraph - February 1, 2010
Royal Bank of Scotland is considering a sale and leaseback of Gogarburn, its flagship Scottish headquarters, as part of a strategic review of its £4bn property portfolio.
A sale of the 1 million square foot office complex on the outskirts of Edinburgh would be the clearest example yet of the new management's break with the past.
Gogarburn was Sir Fred Goodwin's pet project as chief executive of the bank, which is now 84pc-owned by the state after being bailed out with £53.5bn of taxpayer money. The executive wing became known as "Fred's folly" and his involvement is said to have stretched right down to choosing the wallpaper.
The site, set in 100 acres of woodland on the site of a former psychiatric institution, cost £350m to build and was opened in 2005.
Although a strategic review of the group's £4bn own-premises portfolio has begun, Stephen Hester, the new chief executive, has stressed there is no question of moving the 3,200 staff.
However, insiders said a sale and leaseback could be a more efficient use of the bank's resources. One said: "Stephen Hester and the new finance director have every area of cost under challenge and review. There are lots of feasibility studies on every aspect of the operation. This sounds like one of them. Like all these things, some will fly, some won't."
RBS has a further £4bn of investment properties, currently rented out, that could also be put up for disposal. Should it be sold, Gogarburn alone would be expected to raise more than £500m.
Property experts said Gogarburn would make an attractive acquisition for a large property group, such as British Land or Land Securities, due to its unique attributes. Mr Hester is a former chief executive of British Land.
"Goodwin may have made some bad decisions, but Gogarburn was not one of them," a source said. "If RBS ever did decide to leave, a developer could easily arrange the premises for a number of different companies."
The complex is famous for the "street", a glass-ceilinged concourse lined with shops and restaurants. There is also an on-site nursery and a shuttle bus service direct to Edinburgh centre.
Gogarburn is the jewel in RBS's property crown but the bank is also reviewing its London properties. Some 20,000 staff are spread across 18 sites in London and teams are assessing whether they should be consolidated.
RBS is not averse to sale and leasebacks. Two years ago it raised £800m in property sales, including its landmark Coutts building. HSBC recently sold its Canary Wharf headquarters in a £773m sale and leaseback transaction.
A decision is not thought to be imminent as the strategic review is in its early stages.
The bank is in the process of selling off assets, including its RBS Sempra commodity trading joint venture. An outline £2.5bn deal had been agreed with JP Morgan but it has been jeopardised by US plans to ban banks from conducting proprietary trading.
RBS is now negotiating to sell JP Morgan just the international operation, which accounts for roughly half the business. Its partner, Sempra Energy, may attempt a buy-out of the rest. As a trading firm, Sempra Energy is exempt from the planned US rule. Sphere: Related Content
Royal Bank of Scotland is considering a sale and leaseback of Gogarburn, its flagship Scottish headquarters, as part of a strategic review of its £4bn property portfolio.
A sale of the 1 million square foot office complex on the outskirts of Edinburgh would be the clearest example yet of the new management's break with the past.
Gogarburn was Sir Fred Goodwin's pet project as chief executive of the bank, which is now 84pc-owned by the state after being bailed out with £53.5bn of taxpayer money. The executive wing became known as "Fred's folly" and his involvement is said to have stretched right down to choosing the wallpaper.
The site, set in 100 acres of woodland on the site of a former psychiatric institution, cost £350m to build and was opened in 2005.
Although a strategic review of the group's £4bn own-premises portfolio has begun, Stephen Hester, the new chief executive, has stressed there is no question of moving the 3,200 staff.
However, insiders said a sale and leaseback could be a more efficient use of the bank's resources. One said: "Stephen Hester and the new finance director have every area of cost under challenge and review. There are lots of feasibility studies on every aspect of the operation. This sounds like one of them. Like all these things, some will fly, some won't."
RBS has a further £4bn of investment properties, currently rented out, that could also be put up for disposal. Should it be sold, Gogarburn alone would be expected to raise more than £500m.
Property experts said Gogarburn would make an attractive acquisition for a large property group, such as British Land or Land Securities, due to its unique attributes. Mr Hester is a former chief executive of British Land.
"Goodwin may have made some bad decisions, but Gogarburn was not one of them," a source said. "If RBS ever did decide to leave, a developer could easily arrange the premises for a number of different companies."
The complex is famous for the "street", a glass-ceilinged concourse lined with shops and restaurants. There is also an on-site nursery and a shuttle bus service direct to Edinburgh centre.
Gogarburn is the jewel in RBS's property crown but the bank is also reviewing its London properties. Some 20,000 staff are spread across 18 sites in London and teams are assessing whether they should be consolidated.
RBS is not averse to sale and leasebacks. Two years ago it raised £800m in property sales, including its landmark Coutts building. HSBC recently sold its Canary Wharf headquarters in a £773m sale and leaseback transaction.
A decision is not thought to be imminent as the strategic review is in its early stages.
The bank is in the process of selling off assets, including its RBS Sempra commodity trading joint venture. An outline £2.5bn deal had been agreed with JP Morgan but it has been jeopardised by US plans to ban banks from conducting proprietary trading.
RBS is now negotiating to sell JP Morgan just the international operation, which accounts for roughly half the business. Its partner, Sempra Energy, may attempt a buy-out of the rest. As a trading firm, Sempra Energy is exempt from the planned US rule. Sphere: Related Content
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