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
Friday, February 19, 2010
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
Sunday, January 24, 2010
Piggly Wiggly Enters $28 Million Sale Leaseback of Distribution Center in SC
The Post and Courier - January 23, 2010
Piggly Wiggly Carolina Co., which operates 110 grocery stores throughout the Southeast, has sold its main, 615,650-square-foot storage warehouse near Summerville to a Charleston real estate investment company, which is leasing the space back to the supermarket chain.
The $28 million sale and lease-back deal will allow the company to focus on its core business of selling groceries and tap valuable cash to invest, said David Schools, Piggly Wiggly Carolina's chief executive officer.
"It'll help us manage our debt better and put more money into our current locations," he said, noting that a handful of stores are due for remodeling.
In 2008 the grocer made a similar deal with its truck fleet by selling it to Miami-based Ryder Systems and leasing the vehicles back to minimize risk and cut costs.
Piggly Wiggly Carolina sold its main distribution center to Charleston-based J.L. Woode, which already manages two other facilities for the supermarket operator -- its corporate headquarters building on Croghan Spur Road in West Ashley and a 428,887-square-foot warehouse in North Charleston.
While one reason for the sale was to generate cash, Schools said the deal isn't a sign of financial hardship.
"It's just a sign of us taking an asset and positioning it to best help us in the future," he said.
The move won't affect payroll at the company, Schools added. He said Piggly Wiggly employees will continue to maintain the facility under the long-term lease agreement.
The company built the distribution center in the Jedburg area along Interstate 26 in 1999. Sphere: Related Content
Piggly Wiggly Carolina Co., which operates 110 grocery stores throughout the Southeast, has sold its main, 615,650-square-foot storage warehouse near Summerville to a Charleston real estate investment company, which is leasing the space back to the supermarket chain.
The $28 million sale and lease-back deal will allow the company to focus on its core business of selling groceries and tap valuable cash to invest, said David Schools, Piggly Wiggly Carolina's chief executive officer.
"It'll help us manage our debt better and put more money into our current locations," he said, noting that a handful of stores are due for remodeling.
In 2008 the grocer made a similar deal with its truck fleet by selling it to Miami-based Ryder Systems and leasing the vehicles back to minimize risk and cut costs.
Piggly Wiggly Carolina sold its main distribution center to Charleston-based J.L. Woode, which already manages two other facilities for the supermarket operator -- its corporate headquarters building on Croghan Spur Road in West Ashley and a 428,887-square-foot warehouse in North Charleston.
While one reason for the sale was to generate cash, Schools said the deal isn't a sign of financial hardship.
"It's just a sign of us taking an asset and positioning it to best help us in the future," he said.
The move won't affect payroll at the company, Schools added. He said Piggly Wiggly employees will continue to maintain the facility under the long-term lease agreement.
The company built the distribution center in the Jedburg area along Interstate 26 in 1999. Sphere: Related Content
Monday, January 18, 2010
Spanish Real Estate Lawyers Benefit From Flood of Sale Leaseback Deals
Iberian Lawyer
While the majority of international real estate investors continue to reject the Spanish property market after its dramatic implosion, some at least have been attracted by a steady stream of sale-andleaseback offerings – work that many RE lawyers admit to being grateful for in an otherwise dead market.
One of the biggest European real estate deals this year involved Spain’s number two bank, BBVA, which sold a portfolio of 948 bank branches and landmark buildings throughout Spain to a consortium formed by Banco March and international private equity funds RREEF Alternative Investments, Area Property Partners and Europa Capital, for €1.2bn. BBVA was advised by Clifford Chance, the buyers by Freshfields and the banks syndicating the buyers’ loan by Linklaters and Uría Menéndez. BBVA is expected to release the remaining 20% of its property assets shortly.
On a smaller scale, Uría Menéndez advised Caixa Galicia on the sale and lease-back of 41 properties. The purchasers were advised by Baker & McKenzie.
Encouraged by this and other deals, Spain’s secondranked savings bank, Caja Madrid, issued a 25-year sale-and-leaseback prospectus for an initial lot of 58 branches. If the operation reaches its target price of €70m Caja Madrid will release more of its 2,183- branch network. Banco Sabadell and Banesto, which had originally planned to release their entire portfolios in one operation, will also now drip feed the market.
These deals, and last year’s equally epic €4bn sale of virtually all of Santander’s property portfolio, have persuaded Spanish corporates that they too can realise locked-up value by following the same process. A Jones Lang Lasalle study reveals that 32% by volume of real estate investment deals made in Barcelona this year have been related to sale-andleaseback deals.
Uría Menéndez advised travel specialist Grupo Marsans in the sale and lease of its Campo de las Naciones (Madrid) headquarters. The purchaser, German investment fund URE, was advised by Gómez-Acebo & Pombo. Utilities, transport and infrastructures company Acciona has now put up for sale-and-leaseback two of its Alcobendas, Madrid headquarter buildings, hoping to book €60m to its accounts. Swiss insurance giant Zurich has put its Barcelona headquarters on the block with the expectation of receiving at least €50m. Construction and infrastructure powerhouse Ferrovial is looking for a similar deal for its Madrid headquarters. It may earn €40m for the only building it owns, the rest that it uses are leased.
This move by the corporates will please the smaller law firms, which do not have big teams capable of handling hundreds of property deals simultaneously. In addition, there is less financial risk if the operation does not prosper with success fees now the order of the day.
RE lawyers are also however expecting a boost from the enactment of the new legal framework for investment companies to set up Real Estate Investment Trusts (REITs – SOCIMIs in Spanish), which details the compliance requirements to benefit from the beneficial corporate tax regime (18% instead of 30%) as well as exemption from taxation on dividend distributions.
The investment companies must have a minimum share capital of €15m, follow specific criteria on profit distribution and have an asset portfolio made up of at least 80% of real estate investments that can be rented or acquired with full legal title or through participation in companies. SOCIMIs, the Government hopes, will help stabilise the real estate market, bring new investment, and encourage housing rentals over the coming years. Sphere: Related Content
While the majority of international real estate investors continue to reject the Spanish property market after its dramatic implosion, some at least have been attracted by a steady stream of sale-andleaseback offerings – work that many RE lawyers admit to being grateful for in an otherwise dead market.
One of the biggest European real estate deals this year involved Spain’s number two bank, BBVA, which sold a portfolio of 948 bank branches and landmark buildings throughout Spain to a consortium formed by Banco March and international private equity funds RREEF Alternative Investments, Area Property Partners and Europa Capital, for €1.2bn. BBVA was advised by Clifford Chance, the buyers by Freshfields and the banks syndicating the buyers’ loan by Linklaters and Uría Menéndez. BBVA is expected to release the remaining 20% of its property assets shortly.
On a smaller scale, Uría Menéndez advised Caixa Galicia on the sale and lease-back of 41 properties. The purchasers were advised by Baker & McKenzie.
Encouraged by this and other deals, Spain’s secondranked savings bank, Caja Madrid, issued a 25-year sale-and-leaseback prospectus for an initial lot of 58 branches. If the operation reaches its target price of €70m Caja Madrid will release more of its 2,183- branch network. Banco Sabadell and Banesto, which had originally planned to release their entire portfolios in one operation, will also now drip feed the market.
These deals, and last year’s equally epic €4bn sale of virtually all of Santander’s property portfolio, have persuaded Spanish corporates that they too can realise locked-up value by following the same process. A Jones Lang Lasalle study reveals that 32% by volume of real estate investment deals made in Barcelona this year have been related to sale-andleaseback deals.
Uría Menéndez advised travel specialist Grupo Marsans in the sale and lease of its Campo de las Naciones (Madrid) headquarters. The purchaser, German investment fund URE, was advised by Gómez-Acebo & Pombo. Utilities, transport and infrastructures company Acciona has now put up for sale-and-leaseback two of its Alcobendas, Madrid headquarter buildings, hoping to book €60m to its accounts. Swiss insurance giant Zurich has put its Barcelona headquarters on the block with the expectation of receiving at least €50m. Construction and infrastructure powerhouse Ferrovial is looking for a similar deal for its Madrid headquarters. It may earn €40m for the only building it owns, the rest that it uses are leased.
This move by the corporates will please the smaller law firms, which do not have big teams capable of handling hundreds of property deals simultaneously. In addition, there is less financial risk if the operation does not prosper with success fees now the order of the day.
RE lawyers are also however expecting a boost from the enactment of the new legal framework for investment companies to set up Real Estate Investment Trusts (REITs – SOCIMIs in Spanish), which details the compliance requirements to benefit from the beneficial corporate tax regime (18% instead of 30%) as well as exemption from taxation on dividend distributions.
The investment companies must have a minimum share capital of €15m, follow specific criteria on profit distribution and have an asset portfolio made up of at least 80% of real estate investments that can be rented or acquired with full legal title or through participation in companies. SOCIMIs, the Government hopes, will help stabilise the real estate market, bring new investment, and encourage housing rentals over the coming years. Sphere: Related Content
Whitbread Mulls More Hotel Sale Leasebacks
Property Week - January 15, 2010
The success of Whitbread’s first sale and leaseback last month could give the leisure operator the appetite to sell off a second portfolio.
The owner of Premier Inn, Beefeater and Costa Coffee achieved a yield of 5.5.% when it sold five hotels to M&G Investments for £36.7m.
Whitbread property director Mark Anderson says: “The sale price and yield achieved in the last batch was significantly ahead of our expectations. We were aiming for between 6% and 6.5%.”
“The consensus seems to be that capital values will remain strong for the next six months, so it would be a good time to exercise this strategy again. Discussions are ongoing with the board. We are not ruling it out.”
Anderson says the transaction was a “tester” to see what the group could raise for its hotel expansion programme. Whitbread already has a bank loan to fund its hotel development pipeline, but Anderson says sale and leasebacks could be “an alternative source of funding to back up the debt we already have in place with the bank.”
The leisure group chose hotels in Newcastle upon Tyne, Chester, Thurrock, Leicester and Plymouth from its portfolio of 520 freeholds. The sale of the hotels is due to complete this month. Whitbread has agreed to pay a total annual rent roll of £2m.
Anderson says that although the budget market is still growing, the decline in the wider hotel sector means the group is concentrating on building up a land bank of sites, rather than developing new properties.
This slump was reflected in Whitbread’s half-year results, released last November. Although revenues had risen by 3.1%, pretax profits were down by 10% on same period in 2008. Sphere: Related Content
The success of Whitbread’s first sale and leaseback last month could give the leisure operator the appetite to sell off a second portfolio.
The owner of Premier Inn, Beefeater and Costa Coffee achieved a yield of 5.5.% when it sold five hotels to M&G Investments for £36.7m.
Whitbread property director Mark Anderson says: “The sale price and yield achieved in the last batch was significantly ahead of our expectations. We were aiming for between 6% and 6.5%.”
“The consensus seems to be that capital values will remain strong for the next six months, so it would be a good time to exercise this strategy again. Discussions are ongoing with the board. We are not ruling it out.”
Anderson says the transaction was a “tester” to see what the group could raise for its hotel expansion programme. Whitbread already has a bank loan to fund its hotel development pipeline, but Anderson says sale and leasebacks could be “an alternative source of funding to back up the debt we already have in place with the bank.”
The leisure group chose hotels in Newcastle upon Tyne, Chester, Thurrock, Leicester and Plymouth from its portfolio of 520 freeholds. The sale of the hotels is due to complete this month. Whitbread has agreed to pay a total annual rent roll of £2m.
Anderson says that although the budget market is still growing, the decline in the wider hotel sector means the group is concentrating on building up a land bank of sites, rather than developing new properties.
This slump was reflected in Whitbread’s half-year results, released last November. Although revenues had risen by 3.1%, pretax profits were down by 10% on same period in 2008. Sphere: Related Content
La Caixa Studies Large Sale Leaseback of Spanish Bank Branch Portfolio
Cincodias.com (English Translation by Google) - January 12, 2010
La Caixa is studying to join the trend of reducing the property risk by selling part of its branch network. The box, which has the largest number of branches in the country, in 5,339 total, Deloitte commissioned the project's viability.
Santander and BBVA led the way, who later joined Banco Pastor and Caixa Catalunya, among others. It tries to sell funds and private banking customers packages with most central offices located in major capitals.
The selling entity obtains resources and liquidity to dispose of property assets, currently penalized in the balance, following into the room rented by the formula called sale & lease back. Normally, reserve an option to repurchase at the end of the lease.
For its part, the buyer may get annual returns of up to 6%. So, La Caixa has commissioned Deloitte financial and accounting report on the possibility to dispose of ownership of parts of its network, the largest in the industry, formed last September by closure of 5339 branches.
A spokesman for the Spanish first box noted that "Deloitte conducted the study in the same way that many others who care not performed at the end." The same sources added that there was no firm decision about it, nor on the number of offices to be included in the packages for sale. The president of La Caixa, Isidro Fainé, rejected this formula from asset sales during the presentation of results for the year 2008 almost a year ago.
Closures
In any event, industry sources said that the sale of branches depend on the restructuring of the sector itself, which had closed offices until September 1345, according to the Bank of Spain. International Financial Analyst (AFI), the excess capacity will lead to the elimination of 5,000 offices in over four years.
La Caixa has closed a total of 191 stores in the first nine months of 2009, with the reduction of roughly the same number of ATMs, which stood at a total of 7,923. Sphere: Related Content
La Caixa is studying to join the trend of reducing the property risk by selling part of its branch network. The box, which has the largest number of branches in the country, in 5,339 total, Deloitte commissioned the project's viability.
Santander and BBVA led the way, who later joined Banco Pastor and Caixa Catalunya, among others. It tries to sell funds and private banking customers packages with most central offices located in major capitals.
The selling entity obtains resources and liquidity to dispose of property assets, currently penalized in the balance, following into the room rented by the formula called sale & lease back. Normally, reserve an option to repurchase at the end of the lease.
For its part, the buyer may get annual returns of up to 6%. So, La Caixa has commissioned Deloitte financial and accounting report on the possibility to dispose of ownership of parts of its network, the largest in the industry, formed last September by closure of 5339 branches.
A spokesman for the Spanish first box noted that "Deloitte conducted the study in the same way that many others who care not performed at the end." The same sources added that there was no firm decision about it, nor on the number of offices to be included in the packages for sale. The president of La Caixa, Isidro Fainé, rejected this formula from asset sales during the presentation of results for the year 2008 almost a year ago.
Closures
In any event, industry sources said that the sale of branches depend on the restructuring of the sector itself, which had closed offices until September 1345, according to the Bank of Spain. International Financial Analyst (AFI), the excess capacity will lead to the elimination of 5,000 offices in over four years.
La Caixa has closed a total of 191 stores in the first nine months of 2009, with the reduction of roughly the same number of ATMs, which stood at a total of 7,923. Sphere: Related Content
ARA and CWT Discussing $1 Billion Sale Leaseback to Form New REIT in Singapore
Lushhomemedia.com - January 15, 2010
Shares of ARA Asset Management and CWT rose yesterday, when both companies confirmed plans to launch a regional logistics real estate investment trust (Reit) together.
ARA, a real estate fund manager tied to Hong Kong tycoon Li Ka-shing’s Cheung Kong group, saw its shares hit a year high. They gained seven cents or 7.8 per cent to close at 97 cents.
Shares of logistics firm CWT put on two cents or 2.4 per cent to close at 84.5 cents. The counter has hovered above the 80-cent mark since late December.
Investors were probably cheered by news of the Reit venture between ARA and CWT. In a joint release, the firms said that they are ‘in advanced confidential discussions’ and have made a ‘confidential submission’ to the Singapore Exchange (SGX) to set up and list a logistics Reit here. They have also made submissions to other relevant regulatory authorities.
‘It should be noted that no definitive agreements whatsoever have been executed,’ they highlighted. They added that they have not obtained approvals from regulators, including SGX and the Monetary Authority of Singapore.
ARA and CWT were responding to a Reuters article, which said that the two plan to launch a Reit holding properties worth some $1 billion, and DBS would manage the listing. The information came from ‘a source involved in the transactions’.
While both companies confirmed that they were working together on a Reit, they did not verify the other details mentioned in the Reuters report.
In mid-December, CWT gave the market some clues on its plans. It received a query from SGX on an increase in its share price, and revealed that it was in talks to sell and lease back its logistics facilities for the potential creation of a logistics Reit. Sphere: Related Content
Shares of ARA Asset Management and CWT rose yesterday, when both companies confirmed plans to launch a regional logistics real estate investment trust (Reit) together.
ARA, a real estate fund manager tied to Hong Kong tycoon Li Ka-shing’s Cheung Kong group, saw its shares hit a year high. They gained seven cents or 7.8 per cent to close at 97 cents.
Shares of logistics firm CWT put on two cents or 2.4 per cent to close at 84.5 cents. The counter has hovered above the 80-cent mark since late December.
Investors were probably cheered by news of the Reit venture between ARA and CWT. In a joint release, the firms said that they are ‘in advanced confidential discussions’ and have made a ‘confidential submission’ to the Singapore Exchange (SGX) to set up and list a logistics Reit here. They have also made submissions to other relevant regulatory authorities.
‘It should be noted that no definitive agreements whatsoever have been executed,’ they highlighted. They added that they have not obtained approvals from regulators, including SGX and the Monetary Authority of Singapore.
ARA and CWT were responding to a Reuters article, which said that the two plan to launch a Reit holding properties worth some $1 billion, and DBS would manage the listing. The information came from ‘a source involved in the transactions’.
While both companies confirmed that they were working together on a Reit, they did not verify the other details mentioned in the Reuters report.
In mid-December, CWT gave the market some clues on its plans. It received a query from SGX on an increase in its share price, and revealed that it was in talks to sell and lease back its logistics facilities for the potential creation of a logistics Reit. Sphere: Related Content
Natural Cool Completes $40.3 Million Sale Leaseback of Building in Singapore
InSing.com / ChannelNewsAsia.com - January 13, 2010:
Mainboard-listed Natural Cool Holdings said its unit has told its property at 29 Tai Seng Avenue to Emirates Tarian Capital for S$53 million.
After the deal is done, Natural Cool Investments will leaseback the property for 10 years at an annual average rent of S$4.74 million (an initial yield of 8.95%.)
Natural Cool's CEO, Joseph Ang, said the sale is in line with the firm's efforts to adopt an asset-light strategy.
He added that the firm has not decided what to do with the proceeds of the sale, but may use it to repay bank borrowings, to distribute to shareholders as dividends, or to use as working capital to fund future growth and expansion.
The proposed sale and leaseback deal is subject to shareholder approval, as well as legal and binding due diligence on the property. Sphere: Related Content
Mainboard-listed Natural Cool Holdings said its unit has told its property at 29 Tai Seng Avenue to Emirates Tarian Capital for S$53 million.
After the deal is done, Natural Cool Investments will leaseback the property for 10 years at an annual average rent of S$4.74 million (an initial yield of 8.95%.)
Natural Cool's CEO, Joseph Ang, said the sale is in line with the firm's efforts to adopt an asset-light strategy.
He added that the firm has not decided what to do with the proceeds of the sale, but may use it to repay bank borrowings, to distribute to shareholders as dividends, or to use as working capital to fund future growth and expansion.
The proposed sale and leaseback deal is subject to shareholder approval, as well as legal and binding due diligence on the property. Sphere: Related Content
State of Arizona Sale Leaseback Raises $735 Million
The Arizona Republic - January 15, 2010
The sale of state buildings to investors was so successful that Arizona lawmakers say they hope to do another round to raise up to an additional $300 million.
The two-day sale that ended Wednesday drew $735.4 million from investors.
"We'll have the money in state coffers by January 26," said Alan Ecker, a spokesman for the state Department of Administration.
The state went to the public bond market to sell certificates of participation in a variety of state buildings, including the recently completed archives building, the tower that houses the Governor's Office and six prison buildings in Florence. The state's death row is not part of the sale.
The investments carry a 4.57 percent interest rate, and maturity dates on the certificates vary from three years to 20 years. Interest is expected to cost the state about $400 million, for a total payback of $1.1 billion.
The state retains control of the 14 buildings, which it will continue to occupy and lease back from investors.
Repayments to the certificate holders will come from semiannual lease payments made from the state's general fund, according to the prospectus the state issued on the sale. If the state were to default on the lease payments, the trustees for the investors would take ownership of the buildings.
House Speaker Kirk Adams, R-Mesa, was buoyed by the results, which matched legislators' projections of how much quick cash they believed the sale could net.
"We have more capacity," Adams said. He is aiming for another sale, this time to bring in $200 million to $300 million. Lawmakers must approve a bill to authorize a further sale.
Rep. John Kavanagh, R-Fountain Hills, said the $735 million arriving in the Treasury later this month will help, but not erase, the state's deficit.
"I don't think that gets us home," he said. Lawmakers had already factored the sale proceeds into their budget calculations, leaving a $1.4 billion deficit.
The sale, akin to a bond sale, allowed investors to pay as little as $5,000 for a certificate of participation.
Retail investors, such as individuals, bought $113.8 million in certificates, or 15.5 percent of the total. Institutional investors accounted for the remaining 84.5 percent, or $621.6 million, according to the Department of Administration.
Other buildings that are now technically owned by investors include the state hospital, state legislative offices and the Veterans Memorial Coliseum.
For a full list of the buildings, go to politics.azcentral.com. Sphere: Related Content
The sale of state buildings to investors was so successful that Arizona lawmakers say they hope to do another round to raise up to an additional $300 million.
The two-day sale that ended Wednesday drew $735.4 million from investors.
"We'll have the money in state coffers by January 26," said Alan Ecker, a spokesman for the state Department of Administration.
The state went to the public bond market to sell certificates of participation in a variety of state buildings, including the recently completed archives building, the tower that houses the Governor's Office and six prison buildings in Florence. The state's death row is not part of the sale.
The investments carry a 4.57 percent interest rate, and maturity dates on the certificates vary from three years to 20 years. Interest is expected to cost the state about $400 million, for a total payback of $1.1 billion.
The state retains control of the 14 buildings, which it will continue to occupy and lease back from investors.
Repayments to the certificate holders will come from semiannual lease payments made from the state's general fund, according to the prospectus the state issued on the sale. If the state were to default on the lease payments, the trustees for the investors would take ownership of the buildings.
House Speaker Kirk Adams, R-Mesa, was buoyed by the results, which matched legislators' projections of how much quick cash they believed the sale could net.
"We have more capacity," Adams said. He is aiming for another sale, this time to bring in $200 million to $300 million. Lawmakers must approve a bill to authorize a further sale.
Rep. John Kavanagh, R-Fountain Hills, said the $735 million arriving in the Treasury later this month will help, but not erase, the state's deficit.
"I don't think that gets us home," he said. Lawmakers had already factored the sale proceeds into their budget calculations, leaving a $1.4 billion deficit.
The sale, akin to a bond sale, allowed investors to pay as little as $5,000 for a certificate of participation.
Retail investors, such as individuals, bought $113.8 million in certificates, or 15.5 percent of the total. Institutional investors accounted for the remaining 84.5 percent, or $621.6 million, according to the Department of Administration.
Other buildings that are now technically owned by investors include the state hospital, state legislative offices and the Veterans Memorial Coliseum.
For a full list of the buildings, go to politics.azcentral.com. Sphere: Related Content
Sunday, January 17, 2010
Tesco Enters EUR 36 Million Sale Leaseback of Distribution Center Near Prague
Property Magazine International - January 14, 2010
Deka Immobilien GmbH has acquired the Tesco Distribution Centre in the Prague metropolitan area in the Czech Republic. The logistics property is part of the portfolio held by the open-ended property fund Deka-ImmobilienEuropa. The vendor is Tesco Group PLC, the world’s third largest grocery retailer. The purchase has been implemented as part of a sale and lease-back agreement. Cushman & Wakefield acted on behalf of Tesco Group PLC.
The floor area of around 60,100 sqm is fully let on a long-term basis to Tesco Stores CR, a subsidiary of Tesco Group PLC. The property is situated in an established logistics location with good transport links only 14 km outside Prague. This is the second purchase of a Tesco logistics facility for Deka-ImmobilienEuropa in 2009. In summer, the fund invested some €34 million in a property in the Warsaw metropolitan area, Poland. Sphere: Related Content
Deka Immobilien GmbH has acquired the Tesco Distribution Centre in the Prague metropolitan area in the Czech Republic. The logistics property is part of the portfolio held by the open-ended property fund Deka-ImmobilienEuropa. The vendor is Tesco Group PLC, the world’s third largest grocery retailer. The purchase has been implemented as part of a sale and lease-back agreement. Cushman & Wakefield acted on behalf of Tesco Group PLC.
The floor area of around 60,100 sqm is fully let on a long-term basis to Tesco Stores CR, a subsidiary of Tesco Group PLC. The property is situated in an established logistics location with good transport links only 14 km outside Prague. This is the second purchase of a Tesco logistics facility for Deka-ImmobilienEuropa in 2009. In summer, the fund invested some €34 million in a property in the Warsaw metropolitan area, Poland. Sphere: Related Content
Steinwedell Departs AIC Ventures
Austin Business Journal - January 11, 2010
AIC Ventures Managing Partner David Steinwedell, who closed more than $375 million during his tenure, resigned from the company Friday.
The company said the executive left to pursue real estate opportunities. He joined AIC as managing partner of acquisitions in January 2008 and helped grow assets to more than $750 million.
“Steinwedell helped AIC to further entrench AIC’s position as the preeminent provider of middle market sale leaseback capital by driving record acquisition volumes during a difficult economic environment and expanding our presence into new markets that were untapped prior to David’s tenure. We wish him the best in his new endeavors.” AIC President Peter Carlsen said.
AIC employs 40 and has completed transactions worth more than $1 billion in 28 states. Sphere: Related Content
AIC Ventures Managing Partner David Steinwedell, who closed more than $375 million during his tenure, resigned from the company Friday.
The company said the executive left to pursue real estate opportunities. He joined AIC as managing partner of acquisitions in January 2008 and helped grow assets to more than $750 million.
“Steinwedell helped AIC to further entrench AIC’s position as the preeminent provider of middle market sale leaseback capital by driving record acquisition volumes during a difficult economic environment and expanding our presence into new markets that were untapped prior to David’s tenure. We wish him the best in his new endeavors.” AIC President Peter Carlsen said.
AIC employs 40 and has completed transactions worth more than $1 billion in 28 states. Sphere: Related Content
LaPuma Departs WP Carey
Reuters - January 15, 2010
A spokesman for the company, which is preparing to invest a recently-raised $788 million in commercial property, said LaPuma left in late December by "mutual agreement."
LaPuma was not available for comment.
The spokesman said the international unit includes a 15-strong team, which the company was looking to beef up with real estate managers with international acquisition experience.
LaPuma told Reuters in June that W.P. Carey was looking to raise $1 billion to exploit market opportunities globally. He also said the firm was mulling an Islamic fund [ID:nLN065904], but the plan has now been shelved, the spokesman said.
The spokesman said W. P. Carey was looking at options for LaPuma's successor, but the company had not set a deadline for the appointment.
Last month the company completed its first Spanish sale-and-leaseback transaction, buying 13 retail facilities from Spanish supermarket operator Eroski Sociedad Cooperativa [EROSK.UL]." Sphere: Related Content
A spokesman for the company, which is preparing to invest a recently-raised $788 million in commercial property, said LaPuma left in late December by "mutual agreement."
LaPuma was not available for comment.
The spokesman said the international unit includes a 15-strong team, which the company was looking to beef up with real estate managers with international acquisition experience.
LaPuma told Reuters in June that W.P. Carey was looking to raise $1 billion to exploit market opportunities globally. He also said the firm was mulling an Islamic fund [ID:nLN065904], but the plan has now been shelved, the spokesman said.
The spokesman said W. P. Carey was looking at options for LaPuma's successor, but the company had not set a deadline for the appointment.
Last month the company completed its first Spanish sale-and-leaseback transaction, buying 13 retail facilities from Spanish supermarket operator Eroski Sociedad Cooperativa [EROSK.UL]." Sphere: Related Content
Thursday, January 07, 2010
Net Lease Specialist Stan Johnson Company Planning Aggressive US Expansion
Stan Johnson Company Web Site - January 4, 2009
Stan Johnson Company, the nation’s premier net lease brokerage firm and Net Lease Authority™, is aggressively looking to expand into key markets across the United States. Following the successes of the company’s first regional office which launched in Houston, Texas in August 2008, Stan Johnson Company will continue to expand with plans of opening four to five more offices in targeted cities across the U.S., including Atlanta, San Francisco, Southern California, New York City & Chicago.
"In preparation for the next real estate cycle, we plan to continue leveraging our expertise while capitalizing on our past successes in order to drive new opportunities and growth for the future," said Stan Johnson, CEO of Stan Johnson Company. "We have talked to several top brokers who have expressed interest in joining our firm."
Leading the regional expansion effort is Daniel Herrold, who was promoted to Executive Managing Director of Business Development in November. Herrold will have responsibility for all business development and recruiting efforts leading the company’s growth plans. Since joining the company in 2003, Herrold has closed nearly 200 single tenant deals valued in excess of $1.6 billion, and as Regional Director, he spear-headed the launch of Stan Johnson Company’s Houston office.
The Houston office has proven to be a success, starting with two senior associates who have closed more than 20 deals totaling approximately $75 million in volume. Leveraging this success, the office has recently expanded the staff to include two additional senior associates and an analyst, with plans to continue to grow in 2010. In an effort to replicate the success of the Houston office, Herrold is now actively looking to hire multiple lead brokers in the targeted cities who have a strong track record of achievement in the single tenant net lease industry.
“We see today as an opportunity to hire more talented brokers, penetrate new markets, and grow our brokerage platform at a faster pace. We believe that our company’s value proposition of focusing exclusively in the net lease industry is stronger than it has ever been, particularly in this sluggish investment sales market,” said Herrold. Sphere: Related Content
Stan Johnson Company, the nation’s premier net lease brokerage firm and Net Lease Authority™, is aggressively looking to expand into key markets across the United States. Following the successes of the company’s first regional office which launched in Houston, Texas in August 2008, Stan Johnson Company will continue to expand with plans of opening four to five more offices in targeted cities across the U.S., including Atlanta, San Francisco, Southern California, New York City & Chicago.
"In preparation for the next real estate cycle, we plan to continue leveraging our expertise while capitalizing on our past successes in order to drive new opportunities and growth for the future," said Stan Johnson, CEO of Stan Johnson Company. "We have talked to several top brokers who have expressed interest in joining our firm."
Leading the regional expansion effort is Daniel Herrold, who was promoted to Executive Managing Director of Business Development in November. Herrold will have responsibility for all business development and recruiting efforts leading the company’s growth plans. Since joining the company in 2003, Herrold has closed nearly 200 single tenant deals valued in excess of $1.6 billion, and as Regional Director, he spear-headed the launch of Stan Johnson Company’s Houston office.
The Houston office has proven to be a success, starting with two senior associates who have closed more than 20 deals totaling approximately $75 million in volume. Leveraging this success, the office has recently expanded the staff to include two additional senior associates and an analyst, with plans to continue to grow in 2010. In an effort to replicate the success of the Houston office, Herrold is now actively looking to hire multiple lead brokers in the targeted cities who have a strong track record of achievement in the single tenant net lease industry.
“We see today as an opportunity to hire more talented brokers, penetrate new markets, and grow our brokerage platform at a faster pace. We believe that our company’s value proposition of focusing exclusively in the net lease industry is stronger than it has ever been, particularly in this sluggish investment sales market,” said Herrold. Sphere: Related Content
Tuesday, January 05, 2010
Quiron Group Closes EUR 55 Million Sale Leaseback of Private Clinic in Spain
PropertyEU - November 30, 2009
Spanish lender Banco Sabadell has acquired the new Quiron Vizcaya private clinic in Bilbao, Northern Spain in a EUR 55 mln sale-and-leaseback agreement with Spanish healthcare operator Quiron Group. The financial institution said the property is earmarked for its Sabadell BS Inmobiliario FII real estate fund.
The Quiron Vizcaya clinic opened its doors last week and is the largest private hospital in the Vizcaya region of Spain. It offers around 19,000 m2 of total space distributed across 155 rooms. The Quiron Group has agreed to continue to occupy and operate the property for the next 20 years.
The Spanish healthcare operator has opened a number of new centres in recent months including new clinics in Madrid and Barcelona while a new centre planned for Valencia is due to open in 2011.
Sabadell's real estate fund has so far invested in a total of 44 properties totalling some 500,000 m2 of commercial space. Clinics and nursing homes represent nearly 20% of the assets in the fund, which delivered annual returns of 3.84% over the past 36 months. Sphere: Related Content
Spanish lender Banco Sabadell has acquired the new Quiron Vizcaya private clinic in Bilbao, Northern Spain in a EUR 55 mln sale-and-leaseback agreement with Spanish healthcare operator Quiron Group. The financial institution said the property is earmarked for its Sabadell BS Inmobiliario FII real estate fund.
The Quiron Vizcaya clinic opened its doors last week and is the largest private hospital in the Vizcaya region of Spain. It offers around 19,000 m2 of total space distributed across 155 rooms. The Quiron Group has agreed to continue to occupy and operate the property for the next 20 years.
The Spanish healthcare operator has opened a number of new centres in recent months including new clinics in Madrid and Barcelona while a new centre planned for Valencia is due to open in 2011.
Sabadell's real estate fund has so far invested in a total of 44 properties totalling some 500,000 m2 of commercial space. Clinics and nursing homes represent nearly 20% of the assets in the fund, which delivered annual returns of 3.84% over the past 36 months. Sphere: Related Content
Telereal Trillium To Sell £475 Million Net Leased Property Portfolio
Property Week - January 5, 2010
Telereal Trillium has put a £475m portfolio of assets mainly let to Royal Bank of Scotland up for sale.
It has appointed CB Richard Ellis to sell the Oak portfolio, which comprises 55 assets including the Coutts headquarters on the Strand, Drummonds’ headquarters on Trafalgar Square and Child and Co headquarters on Fleet Street.
More than 45% of the income on the portfolio comes from the London assets. The properties are mainly let to Royal Bank of Scotland until 2037 with annual RPI-rental uplifts.
Graeme Hunter, group property director, Telereal Trillium said “Following the purchase of this portfolio two years ago we have had regular enquiries from many parties interested in acquiring single assets. Since the summer however, the level of interest in a larger portfolio transaction has increased dramatically and as such we see the time as being right to test the market’s appetite for this excellent product.”
Telereal Trillium bought the properties at the end of 2007 in a sale-and-leaseback deal from RBS. Sphere: Related Content
Telereal Trillium has put a £475m portfolio of assets mainly let to Royal Bank of Scotland up for sale.
It has appointed CB Richard Ellis to sell the Oak portfolio, which comprises 55 assets including the Coutts headquarters on the Strand, Drummonds’ headquarters on Trafalgar Square and Child and Co headquarters on Fleet Street.
More than 45% of the income on the portfolio comes from the London assets. The properties are mainly let to Royal Bank of Scotland until 2037 with annual RPI-rental uplifts.
Graeme Hunter, group property director, Telereal Trillium said “Following the purchase of this portfolio two years ago we have had regular enquiries from many parties interested in acquiring single assets. Since the summer however, the level of interest in a larger portfolio transaction has increased dramatically and as such we see the time as being right to test the market’s appetite for this excellent product.”
Telereal Trillium bought the properties at the end of 2007 in a sale-and-leaseback deal from RBS. Sphere: Related Content
Sunday, January 03, 2010
Savola Enters $80 Million Sale Leaseback of Central Warehouse in Riyadh
Maktoob Business - January 3, 2009
Savola Group Co, Saudi Arabia's largest food company, said Sunday it entered in a sale and leaseback deal with Al Rajhi Capital worth 299 million Saudi riyals ($79.73 million) covering its supermarket chain's main warehouse in Riyadh.
The deal will generate SAR55 million in capital gains for Savola and will be used to cover the lease payments and will not boost its net profit in 2009, the company said in a statement on the Saudi bourse Web site.
The contract, inked Saturday between Savola's subsidiary Al Matoun International for Real Estate Investment Holding Co and Al Rajhi Bank's corporate finance unit, for the sale of supermarket chain Al Azizia Panda United Co's central warehouse in Riyadh, is part of a wider strategy to sell real estate assets to free up cash to invest in core businesses, the company said.
Savola has the right to lease the property for 18 years with a 7 year extension option, the company added.
In July, Savola paid SAR440 million to buy Fawaz Alhokair Group's Geant hypermarket chain. The company said the acquisition will boost its share in Saudi's retail market-estimated at SAR96 billion-from 7% to 8% as part of its strategic target to have a 10% market share within the coming five years.
The expansion was expected to increase sales by 13%. Sphere: Related Content
Savola Group Co, Saudi Arabia's largest food company, said Sunday it entered in a sale and leaseback deal with Al Rajhi Capital worth 299 million Saudi riyals ($79.73 million) covering its supermarket chain's main warehouse in Riyadh.
The deal will generate SAR55 million in capital gains for Savola and will be used to cover the lease payments and will not boost its net profit in 2009, the company said in a statement on the Saudi bourse Web site.
The contract, inked Saturday between Savola's subsidiary Al Matoun International for Real Estate Investment Holding Co and Al Rajhi Bank's corporate finance unit, for the sale of supermarket chain Al Azizia Panda United Co's central warehouse in Riyadh, is part of a wider strategy to sell real estate assets to free up cash to invest in core businesses, the company said.
Savola has the right to lease the property for 18 years with a 7 year extension option, the company added.
In July, Savola paid SAR440 million to buy Fawaz Alhokair Group's Geant hypermarket chain. The company said the acquisition will boost its share in Saudi's retail market-estimated at SAR96 billion-from 7% to 8% as part of its strategic target to have a 10% market share within the coming five years.
The expansion was expected to increase sales by 13%. Sphere: Related Content
Saturday, January 02, 2010
CIMB Agrees to $88 Million Sale Leaseback of 65 Bank Branches Across Malaysia
Business Times - December 31, 2009
CIMB Group is selling up to 65 properties that house its banking operations to the Employees Provident Fund (EPF) for RM302.4 million in a related-party sale and leaseback deal.
The group, in an announcement yesterday, said the sale will raise cash for CIMB Bank's working capital, reduce its risk-weighted assets by the book value of the properties and reduce its property risks.
The group is expected to make a gain of RM171 million from the sale.
The properties are currently used to house CIMB Group's banking business operations such as branches and offices.
The sale and leaseback deal will be not be its first.
It sold and leased back its current head office, Bangunan CIMB, and Menara Bumiputra-Commerce.
In late 2007, CIMB group managing director and chief executive officer Datuk Seri Nazir Razak said it was mulling over a third sale and leaseback exercise on some buildings as part of its plan to manage capital more efficiently.
The EPF is a major shareholder in CIMB Group, while Nazir is a member of the pension fund's investment panel. He abstained from voting on the deal. Sphere: Related Content
CIMB Group is selling up to 65 properties that house its banking operations to the Employees Provident Fund (EPF) for RM302.4 million in a related-party sale and leaseback deal.
The group, in an announcement yesterday, said the sale will raise cash for CIMB Bank's working capital, reduce its risk-weighted assets by the book value of the properties and reduce its property risks.
The group is expected to make a gain of RM171 million from the sale.
The properties are currently used to house CIMB Group's banking business operations such as branches and offices.
The sale and leaseback deal will be not be its first.
It sold and leased back its current head office, Bangunan CIMB, and Menara Bumiputra-Commerce.
In late 2007, CIMB group managing director and chief executive officer Datuk Seri Nazir Razak said it was mulling over a third sale and leaseback exercise on some buildings as part of its plan to manage capital more efficiently.
The EPF is a major shareholder in CIMB Group, while Nazir is a member of the pension fund's investment panel. He abstained from voting on the deal. Sphere: Related Content
Thursday, December 31, 2009
Ferrovial Enters EUR 40 Million Sale Leaseback of Madrid HQ
Construction & Maintenance - December 29, 2009
Ferrovial, the Spanish infrastructure group, signed a sale-and-leaseback agreement on its corporate headquarters building with a Spanish property investor. The deal amounts to 40 million euros.
Ferrovial will remain as a tenant for twelve years, with an option on two 5-year extensions. Ferrovial also has the right of first refusal if the buyer decides to sell the building in the future. Today's agreement culminates a process that commenced in September when Ferrovial mandated a property manager to explore the market.
Ferrovial's headquarters is located in Madrid at Calle Príncipe de Vergara, 135. The 8,549 square meter building was inaugurated in 1989; it has seven floors above grade and two basement car parks with space for 100 cars.
The sale is aimed at optimizing Ferrovial's cash flow by raising funds for investment in new business opportunities. Sphere: Related Content
Ferrovial, the Spanish infrastructure group, signed a sale-and-leaseback agreement on its corporate headquarters building with a Spanish property investor. The deal amounts to 40 million euros.
Ferrovial will remain as a tenant for twelve years, with an option on two 5-year extensions. Ferrovial also has the right of first refusal if the buyer decides to sell the building in the future. Today's agreement culminates a process that commenced in September when Ferrovial mandated a property manager to explore the market.
Ferrovial's headquarters is located in Madrid at Calle Príncipe de Vergara, 135. The 8,549 square meter building was inaugurated in 1989; it has seven floors above grade and two basement car parks with space for 100 cars.
The sale is aimed at optimizing Ferrovial's cash flow by raising funds for investment in new business opportunities. Sphere: Related Content
Saturday, December 26, 2009
Whitbread Agrees to £36 Million Sale Leaseback of Five Hotels in UK
Whitbread Web Site - December 24, 2009
Whitbread, the UK's largest hotel and restaurant group, announces today that it has exchanged agreements with M&G Investments for the sale and leaseback of five properties operating as Premier Inn and adjacent restaurants.
On completion, which is expected in January 2010, M&G Investments will pay £36.65 million in cash for the properties and enter into 25 year leases with Whitbread, who will continue to operate the properties. This represents a net initial yield of around 5.5%.
Whitbread remains committed to having a predominantly freehold asset base, while selectively using its property as an alternative source of funding for its pipeline of new developments. Sphere: Related Content
Whitbread, the UK's largest hotel and restaurant group, announces today that it has exchanged agreements with M&G Investments for the sale and leaseback of five properties operating as Premier Inn and adjacent restaurants.
On completion, which is expected in January 2010, M&G Investments will pay £36.65 million in cash for the properties and enter into 25 year leases with Whitbread, who will continue to operate the properties. This represents a net initial yield of around 5.5%.
Whitbread remains committed to having a predominantly freehold asset base, while selectively using its property as an alternative source of funding for its pipeline of new developments. Sphere: Related Content
Wednesday, December 23, 2009
Elmec Agrees to EUR 40 Million Sale Leaseback of Store in Greece
Capital.gr - December 23, 2009
Elmec Sport announces that its fully owned subsidiary and under a merger procedure 'FACTORY OUTLET S.A.', signed today a sale and lease back agreement jointly for 50% each with 'Emporiki Leasing S.A.' and 'EFG Eurobank Ergasias Leasing S.A.' for the owned building where FACTORY OUTLET department store operates in a surface of 13.000 sq.m. The total funding reaches the amount of 40 mn euro.
This agreement lasts for 15 years and the monthly installments are connected with the 3M Euribor plus an additional spread. The inflows from the said agreement will be used primarily to pay off short term loans and secondly to finance the current business plans of the Group. Sphere: Related Content
Elmec Sport announces that its fully owned subsidiary and under a merger procedure 'FACTORY OUTLET S.A.', signed today a sale and lease back agreement jointly for 50% each with 'Emporiki Leasing S.A.' and 'EFG Eurobank Ergasias Leasing S.A.' for the owned building where FACTORY OUTLET department store operates in a surface of 13.000 sq.m. The total funding reaches the amount of 40 mn euro.
This agreement lasts for 15 years and the monthly installments are connected with the 3M Euribor plus an additional spread. The inflows from the said agreement will be used primarily to pay off short term loans and secondly to finance the current business plans of the Group. Sphere: Related Content
Kesko Completes EUR 156 Million Sale Leaseback of 13 Stores in Finland
Kesko Web Site - December 22, 2009
The Kesko Group has today sold 13 retail store properties in different parts of Finland to Varma Mutual Pension Insurance Company. The debt-free selling price of the properties is €156 million. The Kesko Group's gain on the sale is €63 million, which will be treated as a non-recurring item in Kesko's fourth quarter operating profit. In the same connection, Kesko Pension Fund has sold one property owned by it.
All of the above properties have been leased back for use by Kesko's division parent companies under 5-15-year leases with extension options. The lease liability for the real estate sold by the Kesko Group totals €142 million, not classified as a finance lease.
Out of the 13 Kesko Group's properties included in the sale, eight are used by K-food store chains, three by K-rauta, one by the Anttila department store chain and one by VV-Auto. The transaction does not involve changes to the stores' operations. The total area of the properties sold by the Kesko Group is 111,000 m².
At 31 December 2008, Kesko owned 1.0 million m² of properties and had 2.9 million m² of properties on leasehold in Finland and other Nordic countries, the Baltic countries and Russia. Kesko's store site investments were €279 million in 2008. Sphere: Related Content
The Kesko Group has today sold 13 retail store properties in different parts of Finland to Varma Mutual Pension Insurance Company. The debt-free selling price of the properties is €156 million. The Kesko Group's gain on the sale is €63 million, which will be treated as a non-recurring item in Kesko's fourth quarter operating profit. In the same connection, Kesko Pension Fund has sold one property owned by it.
All of the above properties have been leased back for use by Kesko's division parent companies under 5-15-year leases with extension options. The lease liability for the real estate sold by the Kesko Group totals €142 million, not classified as a finance lease.
Out of the 13 Kesko Group's properties included in the sale, eight are used by K-food store chains, three by K-rauta, one by the Anttila department store chain and one by VV-Auto. The transaction does not involve changes to the stores' operations. The total area of the properties sold by the Kesko Group is 111,000 m².
At 31 December 2008, Kesko owned 1.0 million m² of properties and had 2.9 million m² of properties on leasehold in Finland and other Nordic countries, the Baltic countries and Russia. Kesko's store site investments were €279 million in 2008. Sphere: Related Content
HSBC Enters $573 Million Sale Leaseback of Paris Office Buildings
Reuters - December 21, 2009
Europe's largest bank, has sold its Paris offices for 400 million euros ($573 million) to private investors represented by French Properties Management, completing the sale of three properties worldwide.
HSBC France, a HSBC Holdings unit, has agreed to lease the buildings at 103 avenue des Champs-Elysees and 15 rue Vernet for nine years, with break clauses in the fourth, fifth and sixth years, the bank said in a statement on Monday.
Over the past two months, HSBC has sold its European headquarters at London's Canary Wharf to South Korea's National Pension Service for $1.3 billion, and its New York City building to Isreal's IDB Holding Corp (IDBH.TA: Quote, Profile, Research) for $330 million.
HSBC said the Paris agreement would be completed in the first quarter of 2010, subject to conditions, with a subsidiary of a French OPCI (Organisme de Placement Collectif Immobilier) established for the transaction.
The deal was conditional on the City of Paris not exercising its right of pre-emption to buy the buildings in the two-month period immediately after the agreement, HSBC said. Sphere: Related Content
Europe's largest bank, has sold its Paris offices for 400 million euros ($573 million) to private investors represented by French Properties Management, completing the sale of three properties worldwide.
HSBC France, a HSBC Holdings unit, has agreed to lease the buildings at 103 avenue des Champs-Elysees and 15 rue Vernet for nine years, with break clauses in the fourth, fifth and sixth years, the bank said in a statement on Monday.
Over the past two months, HSBC has sold its European headquarters at London's Canary Wharf to South Korea's National Pension Service for $1.3 billion, and its New York City building to Isreal's IDB Holding Corp (IDBH.TA: Quote, Profile, Research) for $330 million.
HSBC said the Paris agreement would be completed in the first quarter of 2010, subject to conditions, with a subsidiary of a French OPCI (Organisme de Placement Collectif Immobilier) established for the transaction.
The deal was conditional on the City of Paris not exercising its right of pre-emption to buy the buildings in the two-month period immediately after the agreement, HSBC said. Sphere: Related Content
Tuesday, December 22, 2009
Rave Cinemas Completes $121 Million Sale Leaseback of 15 Theatres in Eight States
Kansas City Business Journal - December 21, 2009
Entertainment Properties Trust has acquired a portfolio of 15 theaters for about $121 million, the company said in a Monday release.
The theaters will be leased back to an affiliate of their operator, Rave Cinemas LLC, through a master lease agreement, the release said. The master lease includes a term of 20 years with four five-year renewal options and is structured so the tenant is responsible for all costs associated with the properties.
The theaters include a total of 231 screens with 52,731 seats within 1.25 million square feet of space. They are in Connecticut, Massachusetts, New Jersey, Virginia, Kentucky, Ohio, Michigan and Iowa.
(Note: An SEC 8-K filing dated November 11, 2009 stated that the master lease was expected to have an initial base rent equal to the product of the purchase price multiplied by 12%, and provide for escalators every 5 years.) Sphere: Related Content
Entertainment Properties Trust has acquired a portfolio of 15 theaters for about $121 million, the company said in a Monday release.
The theaters will be leased back to an affiliate of their operator, Rave Cinemas LLC, through a master lease agreement, the release said. The master lease includes a term of 20 years with four five-year renewal options and is structured so the tenant is responsible for all costs associated with the properties.
The theaters include a total of 231 screens with 52,731 seats within 1.25 million square feet of space. They are in Connecticut, Massachusetts, New Jersey, Virginia, Kentucky, Ohio, Michigan and Iowa.
(Note: An SEC 8-K filing dated November 11, 2009 stated that the master lease was expected to have an initial base rent equal to the product of the purchase price multiplied by 12%, and provide for escalators every 5 years.) Sphere: Related Content
Saturday, December 19, 2009
Home Depot Distribution Center in Topeka, KS Sold For $23.5 Million
SEC Edgar Database - December 16, 2009
On December 11, 2009, American Realty Capital Trust, Inc. acquired a leasehold interest in a build-to-suit Home Depot Distribution Facility that will service Home Depot stores in the Kansas City region (the “Home Depot Facility”). The Home Depot Facility is a “Rapid Deployment Center” of approximately 465,600 square feet located in Topeka, KS. The aggregate purchase price is approximately $23.5 million, inclusive of all closing costs and fees. The primary lease term under this net lease arrangement is twenty years, having commenced simultaneous with closing, and provides for two extensions of successive five-year terms. The average annual base rent over the initial lease term is approximately $2.2 million.
The purchase price is comprised of a combination of proceeds from the sale of common shares and proceeds received from a four-year non-recourse, fixed-rate first mortgage loan totaling approximately $13.7 million. The first three years of the loan are considered the initial term with a fixed interest rate of 6.25%, and the loan includes a one-year extension option at an interest rate of 6.50%.
The Home Depot Facility is net leased to Home Depot U.S.A., Inc. (“Home Depot”) pursuant to which Home Depot will be required to pay all operating expenses and capital expenditures in addition to base rent, simultaneously with the acquisition of the properties, and have a primary lease term of 20 years. Annual rent is approximately $1.8 million for the first year of the initial lease term (7.65% initial yield), which increases 2% annually. The lease provides for two extensions of successive five-year terms. Sphere: Related Content
On December 11, 2009, American Realty Capital Trust, Inc. acquired a leasehold interest in a build-to-suit Home Depot Distribution Facility that will service Home Depot stores in the Kansas City region (the “Home Depot Facility”). The Home Depot Facility is a “Rapid Deployment Center” of approximately 465,600 square feet located in Topeka, KS. The aggregate purchase price is approximately $23.5 million, inclusive of all closing costs and fees. The primary lease term under this net lease arrangement is twenty years, having commenced simultaneous with closing, and provides for two extensions of successive five-year terms. The average annual base rent over the initial lease term is approximately $2.2 million.
The purchase price is comprised of a combination of proceeds from the sale of common shares and proceeds received from a four-year non-recourse, fixed-rate first mortgage loan totaling approximately $13.7 million. The first three years of the loan are considered the initial term with a fixed interest rate of 6.25%, and the loan includes a one-year extension option at an interest rate of 6.50%.
The Home Depot Facility is net leased to Home Depot U.S.A., Inc. (“Home Depot”) pursuant to which Home Depot will be required to pay all operating expenses and capital expenditures in addition to base rent, simultaneously with the acquisition of the properties, and have a primary lease term of 20 years. Annual rent is approximately $1.8 million for the first year of the initial lease term (7.65% initial yield), which increases 2% annually. The lease provides for two extensions of successive five-year terms. Sphere: Related Content
Friday, December 18, 2009
Occupiers Sold on Sale and Leasebacks
Property Week - December 18, 2009
What do General Motors, Marks & Spencer and HSBC have in common?
These corporate giants carried out some of the most notable sale and leasebacks of the past 10 years.
Occupiers’ motivations for sale and leasebacks in the 2000s varied. In 2001, gym chain LA Fitness took that route for its 37 gyms so it could double its property portfolio and venture into the Spanish market.
Similarly, baa Lynton, the commercial property division of airport operator BAA, sold and leased back a 15 acre site in 2002 to fund the development of Heathrow’s Terminal 5.
The supermarkets, each vying to become the dominant chain, were behind some of the biggest sale and leasebacks of the decade.
Sainsbury’s started in 2000, when it sold 10 stores for £226m to an offshore special purpose vehicle.
Topland Group had its hands full as buyer of a £348m purchase and leaseback of 78 Marks & Spencer shops in 2001 and then a £675m portfolio of 33 Tesco properties and distribution centres in 2002.
As the decade drew to a close, occupiers turned to sale and leasebacks to raise much-needed cash in the credit-starved world of the global financial crisis.
“It was and always has been a cheaper source of debt,” says Julian Lyons, European property director at General Motors, which last year was aiming to raise €200m from the sale and leaseback of its European property assets.
“The past decade has seen occupiers undertake sale and leasebacks sometimes as a pure liquidity play, or with a slack in the economy when money is scarcer. The other reason is simply when an occupier realises that the cost of capital tied up in property is not part of their strategy any more.” Sphere: Related Content
What do General Motors, Marks & Spencer and HSBC have in common?
These corporate giants carried out some of the most notable sale and leasebacks of the past 10 years.
Occupiers’ motivations for sale and leasebacks in the 2000s varied. In 2001, gym chain LA Fitness took that route for its 37 gyms so it could double its property portfolio and venture into the Spanish market.
Similarly, baa Lynton, the commercial property division of airport operator BAA, sold and leased back a 15 acre site in 2002 to fund the development of Heathrow’s Terminal 5.
The supermarkets, each vying to become the dominant chain, were behind some of the biggest sale and leasebacks of the decade.
Sainsbury’s started in 2000, when it sold 10 stores for £226m to an offshore special purpose vehicle.
Topland Group had its hands full as buyer of a £348m purchase and leaseback of 78 Marks & Spencer shops in 2001 and then a £675m portfolio of 33 Tesco properties and distribution centres in 2002.
As the decade drew to a close, occupiers turned to sale and leasebacks to raise much-needed cash in the credit-starved world of the global financial crisis.
“It was and always has been a cheaper source of debt,” says Julian Lyons, European property director at General Motors, which last year was aiming to raise €200m from the sale and leaseback of its European property assets.
“The past decade has seen occupiers undertake sale and leasebacks sometimes as a pure liquidity play, or with a slack in the economy when money is scarcer. The other reason is simply when an occupier realises that the cost of capital tied up in property is not part of their strategy any more.” Sphere: Related Content
Thursday, December 17, 2009
JPMorgan Chase Agrees to $109 Million Sale Leasebak of 4 New York Plaza
The Real Deal - December 17, 2009
JPMorgan Chase is in contract to sell 4 New York Plaza for $108.9 million, or $99-per-square-foot, the Post reported. The buyers of the 23-story, 1.1 million square foot building are Harbor Group International, a real estate company based in Norfolk, Va., and Josh Zamir's Capstone Equities, which owns and operates more than 8 million square feet, including 14 Wall Street and 156 William Street. An e-mail written by Zamir and obtained by the Post revealed that JPMorgan, which had also been previously looking to sell One Chase Manhattan Plaza, would lease back 75 percent of the building at Broad and Water streets for 15 years. The bank is hoping to collect $1 billion in total on the sale of a portfolio of 23 office buildings in eight states. [Post] Sphere: Related Content
JPMorgan Chase is in contract to sell 4 New York Plaza for $108.9 million, or $99-per-square-foot, the Post reported. The buyers of the 23-story, 1.1 million square foot building are Harbor Group International, a real estate company based in Norfolk, Va., and Josh Zamir's Capstone Equities, which owns and operates more than 8 million square feet, including 14 Wall Street and 156 William Street. An e-mail written by Zamir and obtained by the Post revealed that JPMorgan, which had also been previously looking to sell One Chase Manhattan Plaza, would lease back 75 percent of the building at Broad and Water streets for 15 years. The bank is hoping to collect $1 billion in total on the sale of a portfolio of 23 office buildings in eight states. [Post] Sphere: Related Content
Monday, December 14, 2009
Travelodge Launches £100 Million UK Sale Leaseback Program
BigHospitality - December 14, 2009
Travelodge has launched a £100m joint property fund with Twenty10 Fund Management to continue the growth of its budget hotels in the UK.
The fund, which will consist of £50m equity, £50m bank debt and a £500k investment made by Travelodge, will as of 2010 be used to fund the budget hotel chain’s aim to open 600 more hotels by 2020.
Targeting new developments as stand alone properties and mixed use schemes, Travelodge will primarily use the fund to open five new hotels in London and other major UK cities every year, each of which will be leased back to the group on 25-35 year leases.
Paul Harvey, managing director of development at Travelodge, said the fund would enable the group to continue with their UK growth drive.
“This funding will ensure that we are more nimble and enable us to capitalise on opportunities that are presented to us without an investment partner,” he said. “We are now establishing ourselves as the number one hotel brand in many of the country’s largest cities and this new fund will push our growth even further.”
The venture with Twenty10 Fund Management comes six months after Travelodge launched a similar £100m fund with Meghraj, named Tamesis Capital, to acquire 8-14 going concern hotels.
Travelodge, which currently operates 28,000 rooms in 385 hotels, will account for 10 per cent of the total accommodation available in the UK when it reaches its operational target of 70,000 rooms in 10 years time. Sphere: Related Content
Travelodge has launched a £100m joint property fund with Twenty10 Fund Management to continue the growth of its budget hotels in the UK.
The fund, which will consist of £50m equity, £50m bank debt and a £500k investment made by Travelodge, will as of 2010 be used to fund the budget hotel chain’s aim to open 600 more hotels by 2020.
Targeting new developments as stand alone properties and mixed use schemes, Travelodge will primarily use the fund to open five new hotels in London and other major UK cities every year, each of which will be leased back to the group on 25-35 year leases.
Paul Harvey, managing director of development at Travelodge, said the fund would enable the group to continue with their UK growth drive.
“This funding will ensure that we are more nimble and enable us to capitalise on opportunities that are presented to us without an investment partner,” he said. “We are now establishing ourselves as the number one hotel brand in many of the country’s largest cities and this new fund will push our growth even further.”
The venture with Twenty10 Fund Management comes six months after Travelodge launched a similar £100m fund with Meghraj, named Tamesis Capital, to acquire 8-14 going concern hotels.
Travelodge, which currently operates 28,000 rooms in 385 hotels, will account for 10 per cent of the total accommodation available in the UK when it reaches its operational target of 70,000 rooms in 10 years time. Sphere: Related Content
CVS/Caremark Arranges $745 Million Lease Financing for Sale Leaseback of 166 Drug Stores
Another Financial Portal - December 14, 2009
Based on information received through December 8, 2009, Moody's Investors Service assigns a provisional (P) Baa2 rating to $744.9 million of CVS/Caremark Lease-Backed Pass-Through Certificates, Series 2009-B, to be issued by a trust that will acquire 166 first-priority lien commercial mortgage, credit-tenant lease loans.
The loans will be secured by mostly newly constructed drug stores and related realty that will be triple-net leased to subsidiaries of CVS/Caremark Corporation ("CVS"). Each of the leases will be bondable and guaranteed by CVS, and bankruptcy-remote, special purpose borrowers will own each of the fee or ground-leased properties. The loans mature in January 2032.
Fixed net rent under the leases will be sufficient to pay in full all interest and principal of the loans. The 166 drugstores are located in 34 states.
In rating this transaction, Moody's used its credit-tenant lease ("CTL") financing rating methodology ("CTL approach"). Under Moody's CTL approach, the rating of a transaction's certificates is primarily based on the senior unsecured debt rating (or the corporate family rating) of the tenant, usually an investment grade rated company, leasing the real estate collateral supporting the bonds.
This tenant's credit rating is the key factor in determining the probability of default on the underlying lease. The lease generally is "bondable", which means it is an absolute net lease, yielding fixed rent paid to the trust through a lock-box, sufficient under all circumstances to pay in full all interest and principal of the loan. The leased property should be owned by a bankruptcy-remote, special purpose borrower, which grants a first lien mortgage and assignment of rents to the securitization trust.
The dark value of the collateral, which assumes the property is vacant or "dark", is then examined; the dark value must be sufficient, assuming a bankruptcy of the tenant and rejection of the lease, to support the expected loss consistent with the certificates' rating. Moody's may make adjustments reflecting the possibility of lease affirmations by the tenant and for the landlord's claim for lease rejection damages in bankruptcy. Moody's also may give credit for some amortization of the debt, depending upon the rating of the credit tenant. In addition, Moody's considers the overall structure and legal integrity of the transaction. The certificates' rating may change as the senior unsecured debt rating (or the corporate family rating) of the tenant changes.
(NOTE: Reuters reports that the coupon on the 22 year fully ammortizing notes was 7.507%.) Sphere: Related Content
Based on information received through December 8, 2009, Moody's Investors Service assigns a provisional (P) Baa2 rating to $744.9 million of CVS/Caremark Lease-Backed Pass-Through Certificates, Series 2009-B, to be issued by a trust that will acquire 166 first-priority lien commercial mortgage, credit-tenant lease loans.
The loans will be secured by mostly newly constructed drug stores and related realty that will be triple-net leased to subsidiaries of CVS/Caremark Corporation ("CVS"). Each of the leases will be bondable and guaranteed by CVS, and bankruptcy-remote, special purpose borrowers will own each of the fee or ground-leased properties. The loans mature in January 2032.
Fixed net rent under the leases will be sufficient to pay in full all interest and principal of the loans. The 166 drugstores are located in 34 states.
In rating this transaction, Moody's used its credit-tenant lease ("CTL") financing rating methodology ("CTL approach"). Under Moody's CTL approach, the rating of a transaction's certificates is primarily based on the senior unsecured debt rating (or the corporate family rating) of the tenant, usually an investment grade rated company, leasing the real estate collateral supporting the bonds.
This tenant's credit rating is the key factor in determining the probability of default on the underlying lease. The lease generally is "bondable", which means it is an absolute net lease, yielding fixed rent paid to the trust through a lock-box, sufficient under all circumstances to pay in full all interest and principal of the loan. The leased property should be owned by a bankruptcy-remote, special purpose borrower, which grants a first lien mortgage and assignment of rents to the securitization trust.
The dark value of the collateral, which assumes the property is vacant or "dark", is then examined; the dark value must be sufficient, assuming a bankruptcy of the tenant and rejection of the lease, to support the expected loss consistent with the certificates' rating. Moody's may make adjustments reflecting the possibility of lease affirmations by the tenant and for the landlord's claim for lease rejection damages in bankruptcy. Moody's also may give credit for some amortization of the debt, depending upon the rating of the credit tenant. In addition, Moody's considers the overall structure and legal integrity of the transaction. The certificates' rating may change as the senior unsecured debt rating (or the corporate family rating) of the tenant changes.
(NOTE: Reuters reports that the coupon on the 22 year fully ammortizing notes was 7.507%.) Sphere: Related Content
Friday, December 11, 2009
CB Richard Ellis Hired by California for $2B Sale Leaseback Deal
Examiner.com - December 11, 2009
The California Department of General Services (DGS) has awarded a contract to CB Richard Ellis Group, Inc. (NYSE:CBG) to sell 17 state office buildings to investors.
DGS plans to sell the commercial real estate during the first half of 2010 and then enter into long-term leases with the new owners. The state will continue to maintain nearly 100 percent occupancy in all the buildings; this provides an opportunity for investors in a market that normally offers similar properties with an average vacancy rate of up to 20 to 30 percent.
In June, Governor Schwarzenegger directed the sale of the properties located in Los Angeles, Oakland, Sacramento, San Francisco and Santa Rosa in order to raise more than $660 million to offset cuts in the state budget.
CBRE has already begun marketing the properties to investors in the global capital markets. The 11 properties range from the 97,000 square foot Judge Joseph A. Rattigan Building in Santa Rosa, to the LEED Gold Certified Capital Area East End Complex in Sacramento and the 24-story, 863,000 square foot Elihu M. Harris Building in downtown Oakland.
CBRE earned the contract for the brokerage services with the state after competing alongside five other companies. Sphere: Related Content
The California Department of General Services (DGS) has awarded a contract to CB Richard Ellis Group, Inc. (NYSE:CBG) to sell 17 state office buildings to investors.
DGS plans to sell the commercial real estate during the first half of 2010 and then enter into long-term leases with the new owners. The state will continue to maintain nearly 100 percent occupancy in all the buildings; this provides an opportunity for investors in a market that normally offers similar properties with an average vacancy rate of up to 20 to 30 percent.
In June, Governor Schwarzenegger directed the sale of the properties located in Los Angeles, Oakland, Sacramento, San Francisco and Santa Rosa in order to raise more than $660 million to offset cuts in the state budget.
CBRE has already begun marketing the properties to investors in the global capital markets. The 11 properties range from the 97,000 square foot Judge Joseph A. Rattigan Building in Santa Rosa, to the LEED Gold Certified Capital Area East End Complex in Sacramento and the 24-story, 863,000 square foot Elihu M. Harris Building in downtown Oakland.
CBRE earned the contract for the brokerage services with the state after competing alongside five other companies. Sphere: Related Content
US Oncology HQ Near Houston Sold for $45 Million
CNNMoney.com - December 11, 2009
Investment firm W. P. Carey & Co. LLC (NYSE: WPC) announced today that CPA:17 - Global, one of its publicly held non-traded REIT affiliates, has purchased the corporate headquarters of US Oncology, Inc. in Woodlands, Texas, 30 miles north of Houston. CPA:17 - Global purchased the 204,000 square foot facility, which is leased to US Oncology on a long-term basis, for a total of approximately $45 million.
US Oncology, majority-owned by private equity firm Welsh, Carson, Anderson & Stowe, is a premier oncology services company and works closely with physicians, payers, biotechnology, pharmaceutical and medical equipment manufacturers to support every aspect of the cancer care delivery system, from drug development to distribution and outcomes measurement. According to its third quarter 2009 earnings report, US Oncology is affiliated with 1,310 physicians operating in 493 locations in 39 states. Sphere: Related Content
Investment firm W. P. Carey & Co. LLC (NYSE: WPC) announced today that CPA:17 - Global, one of its publicly held non-traded REIT affiliates, has purchased the corporate headquarters of US Oncology, Inc. in Woodlands, Texas, 30 miles north of Houston. CPA:17 - Global purchased the 204,000 square foot facility, which is leased to US Oncology on a long-term basis, for a total of approximately $45 million.
US Oncology, majority-owned by private equity firm Welsh, Carson, Anderson & Stowe, is a premier oncology services company and works closely with physicians, payers, biotechnology, pharmaceutical and medical equipment manufacturers to support every aspect of the cancer care delivery system, from drug development to distribution and outcomes measurement. According to its third quarter 2009 earnings report, US Oncology is affiliated with 1,310 physicians operating in 493 locations in 39 states. Sphere: Related Content
Detention Facility and Police Building Under Construction in Sweeden Pre-Sold for $175 Million
RTT News - November 17, 2009
Skanska (STO:SKAB) has entered into an agreement to sell two ongoing projects, a detention center in Sollentuna outside Stockholm and a police building in Toftanas outside Malmo. The combined floor space totals 40,600 square meters, making it one of the largest property transactions in Sweden this year.
The buyer is a consortium of pension funds belonging to seven leading Swedish companies, namely Atlas Copco, Apoteksbolaget, Ericsson, Sandvik, Skanska, Stora Enso and Volvo.
Skanska's investment in the two properties amounts to SEK 1.25 billion. It is estimated that approximately 65 percent of the investment will have been completed by the end of 2009. In accordance with Skanska's information policy, the sales gain for commercial development properties under construction is not disclosed. The development gain is reported quarterly in pace with completion of the project. Possession of the properties will be taken upon completion of the projects in autumn 2010.
"The transaction clearly demonstrates Skanska's ability to utilize the Group's collective expertise in the areas of construction, project development and financing. I cannot imagine a better example of a win-win situation - the purchasers receive fully leased properties with stable and long-term tenants, public authorities and users gain access to state-of-the-art premises and Skanska's shareholders take satisfaction from construction and development gains," says Johan Karlstrom, Skanska's President and CEO.
Skanska's financial specialist unit Skanska Financial Services took the initiative to gather the pension funds and create the new consortium that is making the property investment.
"For us at Skanska's pension fund, there has long been an interest to invest in modern properties with stable tenants and long leases. When we put the question to other major Swedish pension funds it was revealed that they shared this interest," says Jonas Granholm, manager of Skanska's pension foundations.
The detention facility in Sollentuna is being developed and is owned by Skanska Sweden. It constitutes part of a newly established judicial center for northern Stockholm and is adjacent to the police headquarters and the new district court in central Sollentuna. The building, which includes administrative premises and a detention center, comprises a total of approximately 23,600 square meters. Construction began in January 2008 and the building is scheduled for transfer in September 2010. The entire property is leased to the Swedish Prison and Probation Service on a 25-year contract.
The police building in Malmo is being developed and is owned by Skanska resund, which is part Skanska Commercial Development Nordic. The police building for operating units in Malmo is located in Toftanas, about seven kilometers east of central Malmo. The building, comprising approximately 17,000 square meters, houses offices, garages, workshops and a sports center. Construction started in September 2008 and it is scheduled for completion in June 2010. The entire property is leased to the Police Authorities in Skane on a 25-year lease. Sphere: Related Content
Skanska (STO:SKAB) has entered into an agreement to sell two ongoing projects, a detention center in Sollentuna outside Stockholm and a police building in Toftanas outside Malmo. The combined floor space totals 40,600 square meters, making it one of the largest property transactions in Sweden this year.
The buyer is a consortium of pension funds belonging to seven leading Swedish companies, namely Atlas Copco, Apoteksbolaget, Ericsson, Sandvik, Skanska, Stora Enso and Volvo.
Skanska's investment in the two properties amounts to SEK 1.25 billion. It is estimated that approximately 65 percent of the investment will have been completed by the end of 2009. In accordance with Skanska's information policy, the sales gain for commercial development properties under construction is not disclosed. The development gain is reported quarterly in pace with completion of the project. Possession of the properties will be taken upon completion of the projects in autumn 2010.
"The transaction clearly demonstrates Skanska's ability to utilize the Group's collective expertise in the areas of construction, project development and financing. I cannot imagine a better example of a win-win situation - the purchasers receive fully leased properties with stable and long-term tenants, public authorities and users gain access to state-of-the-art premises and Skanska's shareholders take satisfaction from construction and development gains," says Johan Karlstrom, Skanska's President and CEO.
Skanska's financial specialist unit Skanska Financial Services took the initiative to gather the pension funds and create the new consortium that is making the property investment.
"For us at Skanska's pension fund, there has long been an interest to invest in modern properties with stable tenants and long leases. When we put the question to other major Swedish pension funds it was revealed that they shared this interest," says Jonas Granholm, manager of Skanska's pension foundations.
The detention facility in Sollentuna is being developed and is owned by Skanska Sweden. It constitutes part of a newly established judicial center for northern Stockholm and is adjacent to the police headquarters and the new district court in central Sollentuna. The building, which includes administrative premises and a detention center, comprises a total of approximately 23,600 square meters. Construction began in January 2008 and the building is scheduled for transfer in September 2010. The entire property is leased to the Swedish Prison and Probation Service on a 25-year contract.
The police building in Malmo is being developed and is owned by Skanska resund, which is part Skanska Commercial Development Nordic. The police building for operating units in Malmo is located in Toftanas, about seven kilometers east of central Malmo. The building, comprising approximately 17,000 square meters, houses offices, garages, workshops and a sports center. Construction started in September 2008 and it is scheduled for completion in June 2010. The entire property is leased to the Police Authorities in Skane on a 25-year lease. Sphere: Related Content
Thursday, December 10, 2009
AIC Ventures Starts New Sale Leaseback Investment Fund
Austin Business Journal - December 1, 2009
AIC Ventures has begun to acquire assets for a new real estate trust through its subsidiary, NL Ventures VIII LP.
The Austin-based company invests in a diversified pool of single-tenant, net leased office, industrial and warehouse real estate throughout the country. For its latest trust, the company will make about 25 acquisitions for NL Ventures VIII and will consider properties valued from $3 million to $40 million. Two assets are scheduled to close prior to year end.
The new investment fund, the company’s eighth, has been in the planning stages for the past year.
“This time of economic uncertainty has created compelling investment opportunities for our funds,” said David Steinwedell, managing partner of acquisitions. “We are completing the acquisitions for our seventh fund and are very pleased to be able to continue to provide capital to middle-market companies through sale-lease back and net leased transactions. This type of financing effectively turns a company’s bricks and mortar into working capital. We particularly appreciate the confidence our investors have, once again, placed in us.”
The properties acquired by the new fund will be structured as absolute net leases, where the tenants maintain operational control of the real estate while gaining immediate access to capital. Typically, tenants use sale-lease back agreements to reduce debt or help fund corporate growth, among other things. Sphere: Related Content
AIC Ventures has begun to acquire assets for a new real estate trust through its subsidiary, NL Ventures VIII LP.
The Austin-based company invests in a diversified pool of single-tenant, net leased office, industrial and warehouse real estate throughout the country. For its latest trust, the company will make about 25 acquisitions for NL Ventures VIII and will consider properties valued from $3 million to $40 million. Two assets are scheduled to close prior to year end.
The new investment fund, the company’s eighth, has been in the planning stages for the past year.
“This time of economic uncertainty has created compelling investment opportunities for our funds,” said David Steinwedell, managing partner of acquisitions. “We are completing the acquisitions for our seventh fund and are very pleased to be able to continue to provide capital to middle-market companies through sale-lease back and net leased transactions. This type of financing effectively turns a company’s bricks and mortar into working capital. We particularly appreciate the confidence our investors have, once again, placed in us.”
The properties acquired by the new fund will be structured as absolute net leases, where the tenants maintain operational control of the real estate while gaining immediate access to capital. Typically, tenants use sale-lease back agreements to reduce debt or help fund corporate growth, among other things. Sphere: Related Content
Shoppers Drug Mart Agrees to $30 Million Sale Leaseback of 12 Retail Properties Across Canada
CNW Telbec - November 16, 2009
Scott's Real Estate Investment Trust (TSX: SRQ.UN) ("Scott's REIT") announced today that it has signed a purchase agreement with certain wholly owned subsidiaries of Shoppers Drug Mart Corporation (TSX:SC), Canada's largest retail drug store chain, to acquire 12 retail properties across Canada. The $30-million sale and leaseback transaction, subject to satisfactory completion of due diligence and other customary closing conditions, is scheduled to be completed by the end of the year.
Throughout the tight credit markets, Scott's REIT has demonstrated the strong performance and financial flexibility needed to pursue strategic acquisitions, while maintaining stable, consistent cash distributions to its unitholders. Over the past four years, the REIT has created a successful and sustainable business model by focusing solely on "small-box" retail properties less than 50,000 sq. ft. With this acquisition Scott's will have completed more than $100 million in profitable acquisitions since its IPO, making it one of the industry's top performers.
"In 2005, we recognized an opportunity to build a profitable niche market in Canada by focusing primarily on small-box properties," said Bitove. "This acquisition further validates the success of that strategy as we continue to expand beyond the quick-service restaurants to include strong national tenants in growth industries such as pharmacies, banks and other reliable sectors."
Once the acquisition is complete, Scott's REIT will own a portfolio of 219 retail properties in seven provinces across Canada. Under the terms of the agreement, Scott's REIT will purchase a total of 148,169 sq. ft. of single and multi-tenant retail space in Nova Scotia, Quebec, Ontario, Manitoba and Alberta. The properties are leased long-term to Shoppers Realty Inc. and are tenanted by Shoppers Drug Mart, Pharmaprix and Shoppers Home Health Care stores. Sphere: Related Content
Scott's Real Estate Investment Trust (TSX: SRQ.UN) ("Scott's REIT") announced today that it has signed a purchase agreement with certain wholly owned subsidiaries of Shoppers Drug Mart Corporation (TSX:SC), Canada's largest retail drug store chain, to acquire 12 retail properties across Canada. The $30-million sale and leaseback transaction, subject to satisfactory completion of due diligence and other customary closing conditions, is scheduled to be completed by the end of the year.
Throughout the tight credit markets, Scott's REIT has demonstrated the strong performance and financial flexibility needed to pursue strategic acquisitions, while maintaining stable, consistent cash distributions to its unitholders. Over the past four years, the REIT has created a successful and sustainable business model by focusing solely on "small-box" retail properties less than 50,000 sq. ft. With this acquisition Scott's will have completed more than $100 million in profitable acquisitions since its IPO, making it one of the industry's top performers.
"In 2005, we recognized an opportunity to build a profitable niche market in Canada by focusing primarily on small-box properties," said Bitove. "This acquisition further validates the success of that strategy as we continue to expand beyond the quick-service restaurants to include strong national tenants in growth industries such as pharmacies, banks and other reliable sectors."
Once the acquisition is complete, Scott's REIT will own a portfolio of 219 retail properties in seven provinces across Canada. Under the terms of the agreement, Scott's REIT will purchase a total of 148,169 sq. ft. of single and multi-tenant retail space in Nova Scotia, Quebec, Ontario, Manitoba and Alberta. The properties are leased long-term to Shoppers Realty Inc. and are tenanted by Shoppers Drug Mart, Pharmaprix and Shoppers Home Health Care stores. Sphere: Related Content
Saturday, December 05, 2009
Carillion Completes Sale Leaseback of UK Support Center
Property Week - December 4, 2009
Carillion has leased the 42,000 sq ft building back on a 15 year term to relocate its National Support Centre from Rotherham.
John Platt, managing director of Carillion Facilities Management, said: “This new location will be a key element of the strategy for Carillion in the development of a centre of excellence for customer communication centres.”
Councillor Colin Ross, cabinet member for employment, enterprise and development at Sheffield City Council said: "The sale of the offices is a substantial investment in what are difficult market conditions. The move reduces vacant office space and is part of what has been generally a good year for take up of space in contrast to most other cities. The move brings jobs to the city with potentially more to follow."
Carillion was represented by Jones Lang LaSalle and Crossland Otter Hunt, while Chris Freer-Smith Limited acted for Threadneedle. Sphere: Related Content
Carillion has leased the 42,000 sq ft building back on a 15 year term to relocate its National Support Centre from Rotherham.
John Platt, managing director of Carillion Facilities Management, said: “This new location will be a key element of the strategy for Carillion in the development of a centre of excellence for customer communication centres.”
Councillor Colin Ross, cabinet member for employment, enterprise and development at Sheffield City Council said: "The sale of the offices is a substantial investment in what are difficult market conditions. The move reduces vacant office space and is part of what has been generally a good year for take up of space in contrast to most other cities. The move brings jobs to the city with potentially more to follow."
Carillion was represented by Jones Lang LaSalle and Crossland Otter Hunt, while Chris Freer-Smith Limited acted for Threadneedle. Sphere: Related Content
Minerva Seeking £41 Million Sale Leaseback of London HQ
Property Week - December 4, 2009
Minerva is in talks to sell its head office in London’s West End for around £41m to Standard Life Investments
The company plans to lease back the offices at 42 Wigmore Street, north of Oxford Street. The neighbouring 5 Welbeck Street, which is included in the sale, is let to government department the Rent Service.
On Wednesday the London developer urged shareholders to reject an £84.5m offer from South African entrepreneur Nathan Kirsh, calling it “opportunistic” and “wholly inadequate”.
Minerva’s response circular to shareholders showed its portfolio was valued at around £1bn at the end of November, lifting its net asset value to 95p a share — nearly double the 50p-a-share bid.
The £1bn valuation from CB Richard Ellis reflected net growth of £93m since the end of June, equivalent to an increase of 10% in five months.
Minerva’s shares rose 12.7% to 62p on Wednesday, valuing the company at £100m.
“What is particularly opportunistic about the timing of this bid is that it comes after we have done the hard yards and just as we are beginning to see the turn,” chief executive Salmaan Hasan told a conference call.
“We are not going to give away Minerva, having done all the work, just as the market improves in the shareholders’ favour.”
Kirsh and entities related to his KiFin investment vehicle own a 29.9% stake in Minerva. Sphere: Related Content
Minerva is in talks to sell its head office in London’s West End for around £41m to Standard Life Investments
The company plans to lease back the offices at 42 Wigmore Street, north of Oxford Street. The neighbouring 5 Welbeck Street, which is included in the sale, is let to government department the Rent Service.
On Wednesday the London developer urged shareholders to reject an £84.5m offer from South African entrepreneur Nathan Kirsh, calling it “opportunistic” and “wholly inadequate”.
Minerva’s response circular to shareholders showed its portfolio was valued at around £1bn at the end of November, lifting its net asset value to 95p a share — nearly double the 50p-a-share bid.
The £1bn valuation from CB Richard Ellis reflected net growth of £93m since the end of June, equivalent to an increase of 10% in five months.
Minerva’s shares rose 12.7% to 62p on Wednesday, valuing the company at £100m.
“What is particularly opportunistic about the timing of this bid is that it comes after we have done the hard yards and just as we are beginning to see the turn,” chief executive Salmaan Hasan told a conference call.
“We are not going to give away Minerva, having done all the work, just as the market improves in the shareholders’ favour.”
Kirsh and entities related to his KiFin investment vehicle own a 29.9% stake in Minerva. Sphere: Related Content
Friday, December 04, 2009
Novo Nordisk Office Building In Princeton Sold for $51.5 Million
NJRealEstateRama - November 4, 2009
Dividend Capital Total Realty Trust Inc., a diversified real estate investment trust (REIT), announced today that it acquired a class-A office property located in Princeton, NJ — centrally located between New York City and Philadelphia. The property totals approximately 167,000 square feet and is currently 100% leased to Novo Nordisk Inc. — a healthcare company that manufactures and markets diabetes care products worldwide.
“This acquisition presents an opportunity for us to enhance the portfolio’s core office holdings with a Class-A property in what we believe is a prestigious Northeast market, while simultaneously diversifying the portfolio’s tenant base with a large pharmaceutical company,” said Guy Arnold, president of Dividend Capital Total Realty Trust Inc. “In addition, the tenant has 13 years remaining on its current triple-net lease, which is guaranteed by its parent company and should generate a dependable long-term cash flow. By entering what we believe is an attractive office market — with numerous corporate headquarters due to the central location in the Northeast — we are able to continue to execute our strategy of acquiring high-quality assets at attractive pricing.”
The property was developed by Patrinely Group, LLC and owned in a venture between Patrinely Group’s parent company, Crimson Capital, Ltd., and USAA Real Estate Company.
(Note: The most recent 10-Q report for Dividend Capital Total Realty Trust Inc. lists the total cost of the building as $51.1 million plus acquisition-related expenses.) Sphere: Related Content
Dividend Capital Total Realty Trust Inc., a diversified real estate investment trust (REIT), announced today that it acquired a class-A office property located in Princeton, NJ — centrally located between New York City and Philadelphia. The property totals approximately 167,000 square feet and is currently 100% leased to Novo Nordisk Inc. — a healthcare company that manufactures and markets diabetes care products worldwide.
“This acquisition presents an opportunity for us to enhance the portfolio’s core office holdings with a Class-A property in what we believe is a prestigious Northeast market, while simultaneously diversifying the portfolio’s tenant base with a large pharmaceutical company,” said Guy Arnold, president of Dividend Capital Total Realty Trust Inc. “In addition, the tenant has 13 years remaining on its current triple-net lease, which is guaranteed by its parent company and should generate a dependable long-term cash flow. By entering what we believe is an attractive office market — with numerous corporate headquarters due to the central location in the Northeast — we are able to continue to execute our strategy of acquiring high-quality assets at attractive pricing.”
The property was developed by Patrinely Group, LLC and owned in a venture between Patrinely Group’s parent company, Crimson Capital, Ltd., and USAA Real Estate Company.
(Note: The most recent 10-Q report for Dividend Capital Total Realty Trust Inc. lists the total cost of the building as $51.1 million plus acquisition-related expenses.) Sphere: Related Content
Tuesday, December 01, 2009
Deutsche Telekom Completes EUR 29 Million Sale Leaseback of Office Complex in Leipzig
Globes Online - November 29, 2009
Ashtrom Properties Ltd. (TASE:ASPR) and Harel Insurance Investments and Financial Services Ltd. (TASE: HARL) have bought an office complex in downtown Leipzig, Germany from Deutsche Telekom AG (NYSE: DT; XETRA: DTEG) in a buy and lease-back deal for €29 million (about NIS 164 million).
A Deutsche Telekom subsidiary occupies 96% of the 36,500-square meter three-building complex, and stores rent the rest. Annual rent totals €2.38 million a year, giving a return on investment of 8.8%. Deutsche Telekom's lease runs through the end of 2018, and has four five-year options to extend. Sphere: Related Content
Ashtrom Properties Ltd. (TASE:ASPR) and Harel Insurance Investments and Financial Services Ltd. (TASE: HARL) have bought an office complex in downtown Leipzig, Germany from Deutsche Telekom AG (NYSE: DT; XETRA: DTEG) in a buy and lease-back deal for €29 million (about NIS 164 million).
A Deutsche Telekom subsidiary occupies 96% of the 36,500-square meter three-building complex, and stores rent the rest. Annual rent totals €2.38 million a year, giving a return on investment of 8.8%. Deutsche Telekom's lease runs through the end of 2018, and has four five-year options to extend. Sphere: Related Content
Sunday, November 29, 2009
Citibank Bay Area Sale Leaseback of Bank Branches Winding Up
GlobeSt.com - November 26, 2009
Citibank came to market with 17 of its Bay Area retail branches last fall offering 10-year leasebacks with up to 3% annual rent increases based on the CPI. Marketed by CB Richard Ellis, all but a couple of the well-located former CalFed branches quickly had signed LOIs from high-net-worth investors looking for an inflation hedge. The closings didn’t go quite as smoothly due to the financial meltdown in the fourth quarter but 13 of them closed this year at an average cap rate of 6%, with the first seven selling at a 5.8% cap rate on average.
“It was a huge undertaking getting that many [sales] going at once,” CBRE retail investment sales specialist Don LeBuhn tells GlobeSt.com. “But they were the best locations so the intrinsic value was there and even though it took a long time to close deals due to the deteriorating economy [which took Citibank’s stock price from $19 to less than $1 while the properties were on the market] the buyers stuck with their prices, with most using 50% bank financing.”
The bank branches range in size from 3,000 square feet to 7,000 square feet and are located in several Bay Area markets including Burlingame, San Mateo, Los Altos, Palo Alto, San Jose, Santa Clara and Sunnyvale. One of the two remaining properties, a branch in Millbrae, closed last week at a 6.5% cap rate. The other should be under contract within a week or so, also at a sub 7% cap rate, says LeBuhn, a vice president with CBRE’s private client group.
All of the transactions were under $5 million, where LeBuhn says there is “tremendous velocity” because thanks to a lot of people who have $1 million or $2 million to invest and have not done well in the stock market in recent years. “They’re thinking I can put this down on a piece of real estate that has built-in annual rental growth and a steady income-producing tenant,” he says.
Moreover, LeBuhn says properties of this size, quality and price are achieving much better cap rates than more expensive deals requiring more equity. “When you get up to $10 million an above it’s highly unlikely you can get even close to a 6% cap rate; it will be more like 7.5% to 8.5%.”
“The yield curve based on pricing steepens dramatically as you ramp up toward $10 million,” explains LeBuhn’s partner, CBRE managing director Trevor Thorpe. “It’s the impact of the capital markets; the greater the equity the greater the risk premium that is required.”
“Ultimately these properties could have been sold as a portfolio at a mugh higher cap rate,” LeBuhn says. “Citibank wanted to maximize their return and we accomplished that for them.” Sphere: Related Content
Citibank came to market with 17 of its Bay Area retail branches last fall offering 10-year leasebacks with up to 3% annual rent increases based on the CPI. Marketed by CB Richard Ellis, all but a couple of the well-located former CalFed branches quickly had signed LOIs from high-net-worth investors looking for an inflation hedge. The closings didn’t go quite as smoothly due to the financial meltdown in the fourth quarter but 13 of them closed this year at an average cap rate of 6%, with the first seven selling at a 5.8% cap rate on average.
“It was a huge undertaking getting that many [sales] going at once,” CBRE retail investment sales specialist Don LeBuhn tells GlobeSt.com. “But they were the best locations so the intrinsic value was there and even though it took a long time to close deals due to the deteriorating economy [which took Citibank’s stock price from $19 to less than $1 while the properties were on the market] the buyers stuck with their prices, with most using 50% bank financing.”
The bank branches range in size from 3,000 square feet to 7,000 square feet and are located in several Bay Area markets including Burlingame, San Mateo, Los Altos, Palo Alto, San Jose, Santa Clara and Sunnyvale. One of the two remaining properties, a branch in Millbrae, closed last week at a 6.5% cap rate. The other should be under contract within a week or so, also at a sub 7% cap rate, says LeBuhn, a vice president with CBRE’s private client group.
All of the transactions were under $5 million, where LeBuhn says there is “tremendous velocity” because thanks to a lot of people who have $1 million or $2 million to invest and have not done well in the stock market in recent years. “They’re thinking I can put this down on a piece of real estate that has built-in annual rental growth and a steady income-producing tenant,” he says.
Moreover, LeBuhn says properties of this size, quality and price are achieving much better cap rates than more expensive deals requiring more equity. “When you get up to $10 million an above it’s highly unlikely you can get even close to a 6% cap rate; it will be more like 7.5% to 8.5%.”
“The yield curve based on pricing steepens dramatically as you ramp up toward $10 million,” explains LeBuhn’s partner, CBRE managing director Trevor Thorpe. “It’s the impact of the capital markets; the greater the equity the greater the risk premium that is required.”
“Ultimately these properties could have been sold as a portfolio at a mugh higher cap rate,” LeBuhn says. “Citibank wanted to maximize their return and we accomplished that for them.” Sphere: Related Content
Saturday, November 28, 2009
Clarian Health Secures $190 Million Lease Financing for New Indiana Medical Campus
GlobeSt.com - November 24, 2009
Clarian Health Partners Inc. has secured $190 million in financing for the proposed Clarian Saxony Medical Center Campus here. Cain Brothers’ Real Estate acted as Clarian’s financial advisor in the deal and also managed to secure a build-to-suit construction leaseback, long-term ownership deal for Clarian.
The Herrick Co. Inc. provided the financing. The real estate investment firm, which has been in operation since 1960, has been involved in more that $3 billion worth of transactions.
Plans for the medical center campus have been in the works for years, with the first sketch of the project going before the public in November of 2007. Without financing the first phase, estimated to cost $180 million, has been stalled. But with the construction and ownership capital in place, Clarian was able to move from the planning phase to actual construction.
This first stage provides for the construction of a 200,000-square-foot forty-bed hospital and urgent care center, and a 100,000-square-foot medical office building. HKS was the architect on the project. Turner Construction and Harmon Construction are join venturing on the construction.
The campus will be built within the 725-acre Saxony mixed-use development in Hamilton County. In 2007, the project was estimated to be worth $750 million and would add one million square feet of retail, 3.5 million square feet of office/industrial and 1,300 residential units. Sphere: Related Content
Clarian Health Partners Inc. has secured $190 million in financing for the proposed Clarian Saxony Medical Center Campus here. Cain Brothers’ Real Estate acted as Clarian’s financial advisor in the deal and also managed to secure a build-to-suit construction leaseback, long-term ownership deal for Clarian.
The Herrick Co. Inc. provided the financing. The real estate investment firm, which has been in operation since 1960, has been involved in more that $3 billion worth of transactions.
Plans for the medical center campus have been in the works for years, with the first sketch of the project going before the public in November of 2007. Without financing the first phase, estimated to cost $180 million, has been stalled. But with the construction and ownership capital in place, Clarian was able to move from the planning phase to actual construction.
This first stage provides for the construction of a 200,000-square-foot forty-bed hospital and urgent care center, and a 100,000-square-foot medical office building. HKS was the architect on the project. Turner Construction and Harmon Construction are join venturing on the construction.
The campus will be built within the 725-acre Saxony mixed-use development in Hamilton County. In 2007, the project was estimated to be worth $750 million and would add one million square feet of retail, 3.5 million square feet of office/industrial and 1,300 residential units. Sphere: Related Content
Friday, November 27, 2009
CBRE - European Sale and Leasebacks Special Report
CB Richard Ellis European Web Site - November, 2009
Corporate sale and leasebacks represent a viable, effective and competitive way of securing capital in an age when cash flow is all-important and the stigma of ‘selling off the family silver’ is a fast-retreating myth.
Our research into this sector of business tells us that the climate has never been better to reap some of the many advantages of a sensibly conducted sale and leaseback of appropriate property. The outlook is positive – so we believe this is a good time for Corporate Treasury to take advantage of this growing opportunity.
The acceptability of the sale and leaseback route was helped by the ‘watershed’ moment when the €1.6 billion HSBC headquarters deal was completed in London in 2007. Other large deals – such as the sale of KarstadtQuelle’s €4.5 billion department store portfolio across Germany – only served to secure sale and leaseback activity’s place in the headlines.
Read more...
EUROPEAN SALE AND LEASEBACKS - A VIABLE ALTERNATIVE FOR RAISING CAPITAL? Sphere: Related Content
Corporate sale and leasebacks represent a viable, effective and competitive way of securing capital in an age when cash flow is all-important and the stigma of ‘selling off the family silver’ is a fast-retreating myth.
Our research into this sector of business tells us that the climate has never been better to reap some of the many advantages of a sensibly conducted sale and leaseback of appropriate property. The outlook is positive – so we believe this is a good time for Corporate Treasury to take advantage of this growing opportunity.
The acceptability of the sale and leaseback route was helped by the ‘watershed’ moment when the €1.6 billion HSBC headquarters deal was completed in London in 2007. Other large deals – such as the sale of KarstadtQuelle’s €4.5 billion department store portfolio across Germany – only served to secure sale and leaseback activity’s place in the headlines.
Read more...
EUROPEAN SALE AND LEASEBACKS - A VIABLE ALTERNATIVE FOR RAISING CAPITAL? Sphere: Related Content
BTicino Completes EUR 23 Million Sale Leaseback of Office Building in Milan
PropertyEU - November 23, 2009
Italian property company Beni Stabili said it has signed an agreement to acquire the D tower of the Procaccini business park located in Via Messina, Milan, for a total of nearly EUR 23 mln, including transaction costs of EUR 3 mln. The transaction reflects a gross yield of around 7%.
The office scheme, offering 7,100 m2 of gross leasable space, was acquired by the Milan-listed property company through a sale-and-leaseback agreement with BTicino. The seller will occupy the scheme under a seven-year lease agreement, with an option for a further six years.
The transaction includes around 50% of equity and a mortgage loan of approximately EUR 15 mln provided by Germany's Dekabank. Beni Stabili already owns another of the four towers in the business park. Sphere: Related Content
Italian property company Beni Stabili said it has signed an agreement to acquire the D tower of the Procaccini business park located in Via Messina, Milan, for a total of nearly EUR 23 mln, including transaction costs of EUR 3 mln. The transaction reflects a gross yield of around 7%.
The office scheme, offering 7,100 m2 of gross leasable space, was acquired by the Milan-listed property company through a sale-and-leaseback agreement with BTicino. The seller will occupy the scheme under a seven-year lease agreement, with an option for a further six years.
The transaction includes around 50% of equity and a mortgage loan of approximately EUR 15 mln provided by Germany's Dekabank. Beni Stabili already owns another of the four towers in the business park. Sphere: Related Content
Wednesday, November 25, 2009
AIB Completes €19 Million Sale Leaseback of Seven Bank Branches
Irish Independent - November 25, 2009
AIB has sold seven branches across north Leinster for a combined €19m in seven separate deals. The total proceeds are close to the €20m target which agents CB Richard Ellis had been seeking when they launched them in June.
The most recent of the branches to sell is that in Monaghan which achieved in excess of €2.5m and close to the quoted price. With a rent of €200,000, it is generating a yield of 7pc. This is slightly higher than the average yield achieved across the seven branches of 6.9pc.
The seven branches are located in Swords, Navan, Dundalk, Monaghan, Kells, Castleblaney and Maynooth.
AIB is committed to a 20 year lease on each branch with a five year break clause and upward only rent reviews every five years. The purchasers of the Navan branch will achieve the highest of the rents €335,000. The purchasers are all investors rather than developers. Two of the purchasers are expected to farm out a share of the investments in two of the branches. Sphere: Related Content
Sunday, November 22, 2009
Investors Look to Sale and Leaseback
The Sunday Business Post Online - November 22, 2009
Corporate sale and leasebacks represent a viable, effective and competitive way of securing capital in an age when cash is all-important.
The stigma of ‘selling off the family silver’, which had been associated with this practice, is now a fast-retreating myth.
The acceptability of the sale and leaseback route was helped by the watershed moment when the €1.6 billion HSBC headquarters deal was completed in London in 2007, along with the sale of Karstadt Quelle’s €4.5 billion department store portfolio across Germany.
Closer to home, both Bank of Ireland and AIB have undertaken substantial sale and leasebacks of their headquarter properties and branch networks.
The first obvious reason that sale and leaseback represents an attractive option is that there has been very little capital available in recent times, largely because of the limited availability of bank credit.
Other key advantages are that it allows a corporate body to raise capital through the business - but unlike a loan, this capital does not have to be paid back, can be cheaper than placing a corporate bond or raising equity and meets the interest of shareholders.
In an environment where conventional forms of finance have become severely restricted and prohibitively expensive, sale and leaseback transactions represent a viable alternative for raising capital through and for the business.
This is evidenced by the fact that sale and leaseback activity experienced rapid growth in recent years, from a €6.9 billion market in Europe in 2004 to €46 billion - and more than 750 separate transactions - in 2007.
This represented a 585 per cent increase over four years, and such disposals went from comprising just 6 per cent of the European investment market in 2004 to nearly 20 per cent in 2007.
In 2008, falling values reduced the relative attraction and volume of asset sales, so occupier disposals in Europe effectively halved in value to €22.5 billion. However, this still comprised some 794 transactions and maintained the sector’s 19 per cent share of the total investment market.
In the first half of this year, an exceptionally quiet period for investment turnover, a further €4.1 billion in occupier disposals accounted for around 17 per cent of the market. These figures reinforce CBRE’s view that sale and leasebacks have established themselves as an important part of the property investment market.
This is because sale-and-leaseback transactions generally create long and well-secured income streams for the purchaser - precisely the kind of investment many are looking for in the current, more risk-averse climate.
In terms of sectors, certain other patterns are emerging. The retail sector has continued to increase its share, accounting for just over 50 per cent of occupier disposals in the first half of 2009, with offices accounting for 23 per cent and industrial 9 per cent.
This is something of a turnaround: office disposals accounted for almost half of all European sale and leaseback transactions in 2007, dropping to 31 per cent in 2008 as retail and manufacturing started to become a growth sector.
Interestingly, in the first half of this year Spain and Italy led the way, with Italy accounting for the largest transaction value, at 24 per cent of the European market. This largely reflects the disposal of a portfolio of 180 high street bank branches by Unicredit for €530 million.
This was followed by Spanish banks Caixa Catalunya and BBVA, totalling €251 million, and BNP Paribas with €250 million in Paris.
CBRE’s research has found that many investors are returning to the property market having invested relatively little in the last few years. The current focus is on the main European markets such as Britain, France and Germany. However, Ireland is now appearing on investors’ radar screens on the basis of offering good value.
Sale and leasebacks are inherently attractive to these investors in offering a secure income stream on a new lease. A good example is the AIB branch on Grafton Street, which offers an opportunity to acquire a prime retail investment on secure terms.
More generally, the potential for continued growth in sale and leaseback activity is immense:
the value of European real estate assets still in the hands of corporates is estimated at around €2.25 trillion, 12 times the average level of European real estate investment turnover over the last five years. It therefore represents a real and present opportunity. Sphere: Related Content
Corporate sale and leasebacks represent a viable, effective and competitive way of securing capital in an age when cash is all-important.
The stigma of ‘selling off the family silver’, which had been associated with this practice, is now a fast-retreating myth.
The acceptability of the sale and leaseback route was helped by the watershed moment when the €1.6 billion HSBC headquarters deal was completed in London in 2007, along with the sale of Karstadt Quelle’s €4.5 billion department store portfolio across Germany.
Closer to home, both Bank of Ireland and AIB have undertaken substantial sale and leasebacks of their headquarter properties and branch networks.
The first obvious reason that sale and leaseback represents an attractive option is that there has been very little capital available in recent times, largely because of the limited availability of bank credit.
Other key advantages are that it allows a corporate body to raise capital through the business - but unlike a loan, this capital does not have to be paid back, can be cheaper than placing a corporate bond or raising equity and meets the interest of shareholders.
In an environment where conventional forms of finance have become severely restricted and prohibitively expensive, sale and leaseback transactions represent a viable alternative for raising capital through and for the business.
This is evidenced by the fact that sale and leaseback activity experienced rapid growth in recent years, from a €6.9 billion market in Europe in 2004 to €46 billion - and more than 750 separate transactions - in 2007.
This represented a 585 per cent increase over four years, and such disposals went from comprising just 6 per cent of the European investment market in 2004 to nearly 20 per cent in 2007.
In 2008, falling values reduced the relative attraction and volume of asset sales, so occupier disposals in Europe effectively halved in value to €22.5 billion. However, this still comprised some 794 transactions and maintained the sector’s 19 per cent share of the total investment market.
In the first half of this year, an exceptionally quiet period for investment turnover, a further €4.1 billion in occupier disposals accounted for around 17 per cent of the market. These figures reinforce CBRE’s view that sale and leasebacks have established themselves as an important part of the property investment market.
This is because sale-and-leaseback transactions generally create long and well-secured income streams for the purchaser - precisely the kind of investment many are looking for in the current, more risk-averse climate.
In terms of sectors, certain other patterns are emerging. The retail sector has continued to increase its share, accounting for just over 50 per cent of occupier disposals in the first half of 2009, with offices accounting for 23 per cent and industrial 9 per cent.
This is something of a turnaround: office disposals accounted for almost half of all European sale and leaseback transactions in 2007, dropping to 31 per cent in 2008 as retail and manufacturing started to become a growth sector.
Interestingly, in the first half of this year Spain and Italy led the way, with Italy accounting for the largest transaction value, at 24 per cent of the European market. This largely reflects the disposal of a portfolio of 180 high street bank branches by Unicredit for €530 million.
This was followed by Spanish banks Caixa Catalunya and BBVA, totalling €251 million, and BNP Paribas with €250 million in Paris.
CBRE’s research has found that many investors are returning to the property market having invested relatively little in the last few years. The current focus is on the main European markets such as Britain, France and Germany. However, Ireland is now appearing on investors’ radar screens on the basis of offering good value.
Sale and leasebacks are inherently attractive to these investors in offering a secure income stream on a new lease. A good example is the AIB branch on Grafton Street, which offers an opportunity to acquire a prime retail investment on secure terms.
More generally, the potential for continued growth in sale and leaseback activity is immense:
the value of European real estate assets still in the hands of corporates is estimated at around €2.25 trillion, 12 times the average level of European real estate investment turnover over the last five years. It therefore represents a real and present opportunity. Sphere: Related Content
Premier Inn Seeking £30 Million Sale Leaseback of Five UK Hotels
Property Gazette is reporting that Whitbread is seeking to raise around £30 million on the sale leaseback of five of its 584 Premier Inns to gauge market interest. BNP Paribas Real Estate has been retained by Whitbread to conduct the sale. Premier Inns will reportedly offer 25-year leases on the properties plus additional renewal option. A successful transaction at an attractive initial yield will likely lead to further Premier Inn sale leaseback opportunities in the near future.
Sphere: Related Content
Griffin Capital Launches Net Lease REIT
GlobeSt.com - November 19, 2009
With its securities registration effective earlier this month, Griffin Capital Corp. has rolled out its new investment vehicle, the GC Net Lease REIT Inc.
The publicly registered, non-traded REIT will purchase both sale-leasebacks directly from corporate occupiers and existing net lease assets from third parties, though its preference is for sale-leasebacks, since those allow the REIT to structure its own leases. It is targeting “mission critical office and industrial properties that are net leased to corporate tenants for long duration,” says Griffin Capital president Kevin Shields.
It’s those kinds of assets—diversified by tenant credit quality, industry, geography, lease duration and property type—that will provide “a very stable return dynamic for us and our investors,” Shields tells GlobeSt.com.
While Griffin Capital management had considered launching a net lease REIT a few years ago, it ultimately waited until this year. One main reason for shelving the REIT earlier was the low cap rate environment in which properties were selling. To be able to pay shareholders a reasonable dividend, properties would need to be purchased in the range of 8.65% to 8.7% caps, says Shields. “At the end of ’07, there was nothing you’d want to own at that kind of cap rate,” he adds.
Today, however, Shields says he sees the return of asset pricing that makes sense, and expects attractive buying opportunities ahead. “We see some pretty frothy opportunity in the sale-leaseback market going forward, because given the capital constraints for every corporate borrower out there, the opportunity to do a sale-leaseback transaction appears to be progressively more appealing” to corporate America, he says.
GC Net Lease REIT’s management team is currently looking at several potential deals, at least one of which Shields hopes to have closed by the end of the year. But unlike most non-traded REITs, GC Net Lease REIT has launched already owning two properties, which were contributed by Griffin Capital principals and represent about $55 million in value, including more than $20 million of equity.
The assets, which Shields says are indicative of the kind of assets the REIT intends to buy going forward, have both recently undergone renovations and extended their absolute net lease leases. One is a 176,025-square-foot office and laboratory facility in Plainfield, IL used by Chicago Bridge & Iron Co. on a 15-year lease that expires in 2022; the other is a 565,206-square-foot distribution facility in Clinton, SC, occupied by Renfro Corp. on a 12-year lease that expires in 2021. Both have rental increases and renewal options.
“Our initial property contributions help support our current dividend,” says Griffin Capital national sales director David Ford. “We are very excited to be bringing this product to the marketplace at this point in the real estate market cycle.”
GC Net Lease REIT’s registration allows it to raise $750 million of equity over the next couple of years, and it can be re-filed in the future to sell even more shares. To start, Shields says he expects to raise $100 million in 2010, which could translate to a couple hundred million dollars of properties. And ultimately Griffin Capital’s objective is to raise as much as $3 billion of equity over a seven-year period, building a portfolio of $5 billion to $6 billion of assets in the process and eventually listing the REIT on an exchange, he says.
Griffin Capital has been investing in the net lease property market going back to 1996. In more recent years, it has been a sponsor of investments structured as tenant-in-common and Delaware Statutory Trust programs, with both single-tenant and multi-tenant assets. Single-tenant properties account for about one-third of its current $1 billion of owned and managed assets. Sphere: Related Content
With its securities registration effective earlier this month, Griffin Capital Corp. has rolled out its new investment vehicle, the GC Net Lease REIT Inc.
The publicly registered, non-traded REIT will purchase both sale-leasebacks directly from corporate occupiers and existing net lease assets from third parties, though its preference is for sale-leasebacks, since those allow the REIT to structure its own leases. It is targeting “mission critical office and industrial properties that are net leased to corporate tenants for long duration,” says Griffin Capital president Kevin Shields.
It’s those kinds of assets—diversified by tenant credit quality, industry, geography, lease duration and property type—that will provide “a very stable return dynamic for us and our investors,” Shields tells GlobeSt.com.
While Griffin Capital management had considered launching a net lease REIT a few years ago, it ultimately waited until this year. One main reason for shelving the REIT earlier was the low cap rate environment in which properties were selling. To be able to pay shareholders a reasonable dividend, properties would need to be purchased in the range of 8.65% to 8.7% caps, says Shields. “At the end of ’07, there was nothing you’d want to own at that kind of cap rate,” he adds.
Today, however, Shields says he sees the return of asset pricing that makes sense, and expects attractive buying opportunities ahead. “We see some pretty frothy opportunity in the sale-leaseback market going forward, because given the capital constraints for every corporate borrower out there, the opportunity to do a sale-leaseback transaction appears to be progressively more appealing” to corporate America, he says.
GC Net Lease REIT’s management team is currently looking at several potential deals, at least one of which Shields hopes to have closed by the end of the year. But unlike most non-traded REITs, GC Net Lease REIT has launched already owning two properties, which were contributed by Griffin Capital principals and represent about $55 million in value, including more than $20 million of equity.
The assets, which Shields says are indicative of the kind of assets the REIT intends to buy going forward, have both recently undergone renovations and extended their absolute net lease leases. One is a 176,025-square-foot office and laboratory facility in Plainfield, IL used by Chicago Bridge & Iron Co. on a 15-year lease that expires in 2022; the other is a 565,206-square-foot distribution facility in Clinton, SC, occupied by Renfro Corp. on a 12-year lease that expires in 2021. Both have rental increases and renewal options.
“Our initial property contributions help support our current dividend,” says Griffin Capital national sales director David Ford. “We are very excited to be bringing this product to the marketplace at this point in the real estate market cycle.”
GC Net Lease REIT’s registration allows it to raise $750 million of equity over the next couple of years, and it can be re-filed in the future to sell even more shares. To start, Shields says he expects to raise $100 million in 2010, which could translate to a couple hundred million dollars of properties. And ultimately Griffin Capital’s objective is to raise as much as $3 billion of equity over a seven-year period, building a portfolio of $5 billion to $6 billion of assets in the process and eventually listing the REIT on an exchange, he says.
Griffin Capital has been investing in the net lease property market going back to 1996. In more recent years, it has been a sponsor of investments structured as tenant-in-common and Delaware Statutory Trust programs, with both single-tenant and multi-tenant assets. Single-tenant properties account for about one-third of its current $1 billion of owned and managed assets. Sphere: Related Content
Bickford Senior Living Closes $28.25 Million Sale Leaseback of Five Assisted Living Facilities in MI & IL
SEC Edgar Web Site - November 19, 2009
National Health Investors, Inc. (NYSE:NHI) announced today it has closed a $28.25 million purchase/leaseback transaction with Bickford Senior Living and its affiliates (“Bickford”) involving four assisted living facilities in Michigan and one in Illinois. The assisted living communities are two to three years old totaling 216 units and attract 100% private payment for services. The purchase price was funded from NHI’s accumulated cash liquidity and includes $3 million in contingent payments to be made over the next three years based on Bickford’s expected achievement of certain operational measures. The five facilities are being leased to Bickford over 15 years at an initial lease rate of 9.5% plus annual fixed escalators. Bickford Senior Living, headquartered in Olathe, Kansas, operates over 40 assisted living, independent living and memory care facilities in Kansas, Iowa, Illinois, Indiana, Missouri, Nebraska and Michigan. The purchase/leaseback of the Bickford facilities brings NHI’s total 2009 year-to-date new investments in long-term care real estate and mortgages to $88.6 million. Sphere: Related Content
National Health Investors, Inc. (NYSE:NHI) announced today it has closed a $28.25 million purchase/leaseback transaction with Bickford Senior Living and its affiliates (“Bickford”) involving four assisted living facilities in Michigan and one in Illinois. The assisted living communities are two to three years old totaling 216 units and attract 100% private payment for services. The purchase price was funded from NHI’s accumulated cash liquidity and includes $3 million in contingent payments to be made over the next three years based on Bickford’s expected achievement of certain operational measures. The five facilities are being leased to Bickford over 15 years at an initial lease rate of 9.5% plus annual fixed escalators. Bickford Senior Living, headquartered in Olathe, Kansas, operates over 40 assisted living, independent living and memory care facilities in Kansas, Iowa, Illinois, Indiana, Missouri, Nebraska and Michigan. The purchase/leaseback of the Bickford facilities brings NHI’s total 2009 year-to-date new investments in long-term care real estate and mortgages to $88.6 million. Sphere: Related Content
IDS Logistics Agrees to $28 Million Sale Leaseback of Seven Warehouses in Malaysia
The Star Online - November 20, 2009
Axis REIT Managers Bhd (ARMB) has proposed to buy seven warehouses in Klang and Seberang Prai for RM96mil from IDS Logistics Services (M) Sdn Bhd.
ARMB said in a statement the sale and leaseback deal comprised five warehouse buildings located in Bukit Raja, Klang, on two pieces of freehold land, while two more were in Seberang Prai, Penang, on separate pieces of leasehold land.
The acquisition was for a total cash consideration of RM71.75mil and RM24.25mil respectively, it said.
The Klang property is located in Bukit Raja Industrial Estate, a premier industrial zone in that area.
The Penang properties are located within the largest industrial estate in northern Peninsular Malaysia, the Prai Industrial Estate Phase 4, about 15km from the Butterworth Ferry Terminal and Railway Station.
The deal comes with a 15-year fixed lease agreement with an option to renew for a further 15 years with IDS Logistics, the current owner and operator. (The monthly rentals will reportedly be be RM666,666.67, resulting in an initial annual yield of approximately 8.3%.)
IDS Logistics is a wholly-owned subsidiary of Hong Kong-based Integrated Distribution Services Group Ltd, a logistics services provider and a member of the Li & Fung Group.
The lease agreements come with an agreed step-up in rental every three years over the 15-year period.
On completion of the acquisition, the fund will, for the first term of the lease, receive RM8mil a year in gross income.
ARMB chief executive office and executive director Stewart Labrooy said the acquisitions would provide a steady income and contribute positively to its earnings next year.
These new acquisitions will also see the company’s assets under management rise to over RM900mil. Sphere: Related Content
Axis REIT Managers Bhd (ARMB) has proposed to buy seven warehouses in Klang and Seberang Prai for RM96mil from IDS Logistics Services (M) Sdn Bhd.
ARMB said in a statement the sale and leaseback deal comprised five warehouse buildings located in Bukit Raja, Klang, on two pieces of freehold land, while two more were in Seberang Prai, Penang, on separate pieces of leasehold land.
The acquisition was for a total cash consideration of RM71.75mil and RM24.25mil respectively, it said.
The Klang property is located in Bukit Raja Industrial Estate, a premier industrial zone in that area.
The Penang properties are located within the largest industrial estate in northern Peninsular Malaysia, the Prai Industrial Estate Phase 4, about 15km from the Butterworth Ferry Terminal and Railway Station.
The deal comes with a 15-year fixed lease agreement with an option to renew for a further 15 years with IDS Logistics, the current owner and operator. (The monthly rentals will reportedly be be RM666,666.67, resulting in an initial annual yield of approximately 8.3%.)
IDS Logistics is a wholly-owned subsidiary of Hong Kong-based Integrated Distribution Services Group Ltd, a logistics services provider and a member of the Li & Fung Group.
The lease agreements come with an agreed step-up in rental every three years over the 15-year period.
On completion of the acquisition, the fund will, for the first term of the lease, receive RM8mil a year in gross income.
ARMB chief executive office and executive director Stewart Labrooy said the acquisitions would provide a steady income and contribute positively to its earnings next year.
These new acquisitions will also see the company’s assets under management rise to over RM900mil. Sphere: Related Content
Thursday, November 19, 2009
Toys 'R' Us to Issue $650 Million in Lease Backed Notes
Fitch Ratings - November 9, 2009
Fitch Ratings has assigned an Issuer Default Rating (IDR) of 'B-' to Toys 'R' Us Property Co. II, LLC (previously known as Giraffe Holdings, LLC) and rates Toys 'R' Us Property Co. II, LLC's new $650 million senior secured notes 'B+/RR2'. The notes are secured by first-priority liens on 129 properties held in a bankruptcy-remote entity with a Master Lease covering all the properties, which requires Toys Delaware to pay all costs and expenses related to the ownership, operation, leasing and maintenance of the properties. In addition, while the property company currently does not have any subsidiaries, the notes will benefit from guarantees by any future subsidiary of the property company. Proceeds from the offering, an intercompany loan and a cash contribution from Toys 'R' Us, Inc. (TOY), as well as the release of restricted cash and cash on hand will be used to repay the existing $600 million Giraffe Holdings CMBS facility and $200 million MPO Holdings CMBS facility.
Fitch has also affirmed the following ratings:
Toys 'R' Us, Inc.
--IDR 'B-'
--Senior Unsecured Notes 'C/RR6'
Toys 'R' Us - Delaware, Inc.
--IDR 'B-'
--Secured Revolver 'B/RR3'
--Secured Term Loan 'CC/RR6'
--Unsecured Term Loan 'CC/RR6'
--Senior Unsecured Notes 'CC/RR6'
Toys 'R' Us Property Co. I, LLC (previously known as TRU 2005 RE Holding Co.)
--IDR 'B-'
--Senior Unsecured Notes 'B+/RR2'
Toys 'R' Us Europe, LLC (previously known as Toys 'R' Us (UK) Ltd.)
--IDR 'B-'
--Secured Revolver 'B/RR3'
The Rating Outlook is Stable. TOY had $5.6 billion in debt outstanding on Aug. 1, 2009. Sphere: Related Content
Fitch Ratings has assigned an Issuer Default Rating (IDR) of 'B-' to Toys 'R' Us Property Co. II, LLC (previously known as Giraffe Holdings, LLC) and rates Toys 'R' Us Property Co. II, LLC's new $650 million senior secured notes 'B+/RR2'. The notes are secured by first-priority liens on 129 properties held in a bankruptcy-remote entity with a Master Lease covering all the properties, which requires Toys Delaware to pay all costs and expenses related to the ownership, operation, leasing and maintenance of the properties. In addition, while the property company currently does not have any subsidiaries, the notes will benefit from guarantees by any future subsidiary of the property company. Proceeds from the offering, an intercompany loan and a cash contribution from Toys 'R' Us, Inc. (TOY), as well as the release of restricted cash and cash on hand will be used to repay the existing $600 million Giraffe Holdings CMBS facility and $200 million MPO Holdings CMBS facility.
Fitch has also affirmed the following ratings:
Toys 'R' Us, Inc.
--IDR 'B-'
--Senior Unsecured Notes 'C/RR6'
Toys 'R' Us - Delaware, Inc.
--IDR 'B-'
--Secured Revolver 'B/RR3'
--Secured Term Loan 'CC/RR6'
--Unsecured Term Loan 'CC/RR6'
--Senior Unsecured Notes 'CC/RR6'
Toys 'R' Us Property Co. I, LLC (previously known as TRU 2005 RE Holding Co.)
--IDR 'B-'
--Senior Unsecured Notes 'B+/RR2'
Toys 'R' Us Europe, LLC (previously known as Toys 'R' Us (UK) Ltd.)
--IDR 'B-'
--Secured Revolver 'B/RR3'
The Rating Outlook is Stable. TOY had $5.6 billion in debt outstanding on Aug. 1, 2009. Sphere: Related Content
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