NJ.com - August 25, 2010
Desperate to close an $83 million deficit, Newark plans to sell one of the last assets it has remaining. Itself, one municipal building at a time.
Police precincts, fire houses and office buildings are being eyed for a sale the city council hopes will generate $50 million for the 2010 budget.
The financial gambit calls for the Essex County Improvement Authority to sell bonds to buy the buildings and then lease them back to Newark over a period of years, according to a plan laid out Tuesday by city and county officials.
It’s a costly and risky solution. With capital improvements, fees and services, the deal is expected to cost the city about $60 million in the long term.
Before any of that happens, the city will have to run through a gauntlet of bureaucracy at warp speed. The plan has to be approved by the authority, the Newark City Council, the Essex County Freeholders, and the state Local Finance Board.
But city leaders say they are running out of time and options to forestall a crippling financial meltdown. Without a solution soon the city will be forced to levy a 30 percent tax increase. Even with the "lease-back" revenue, Newark is facing a possible 20 percent property tax hike and more than 600 layoffs.
The city must have the $50 million in its accounts by mid-November in order to guarantee a balanced budget for this year — and avoid a potential takeover by the state. City officials Tuesday said there was no room for error or delay.
"We’ve built a calendar around a Nov. 12 to a Nov. 18 window, and we’ve worked backward," said Henry Amoroso, a paid city budget consultant. "This is unprecedentedly tight."
City leaders and budget experts disagree on how the city found itself in a budget crisis. Some say the mayor should have attacked the city’s bloated spending years ago. Others say the recession has choked off revenues at the worst possible time for Newark.
Though selling your police precincts seems a bizarre way to raise money, some urban experts say it's a solution that’s catching on.
"The variety of places that are exploring a variety of measures is really quite striking," said Mark Muro, senior fellow at the Brookings Institution. Newark is "really quite in the mainstream," he said.
Mayor Cory Booker’s office would not provide the list of properties being considered, but Amoroso said the buildings had to be in reasonably good condition and the city had to be the tenant. The finance building on Broad Street, one of Newark’s main drags, was mentioned as a good example, along with the city welfare building and the child and family well-being building. The only building not on the table is City Hall, officials said.
"We’re going to follow the council’s leadership on which buildings" to sell, said Booker, who stressed that the idea is being pushed by city council members. "At the end of the day, they’re the deciders. They and the Essex County Improvement Authority."
Essex County Executive Joseph DiVincenzo said as long as bond buyers and not taxpayers were the only ones liable in the transaction, he would support it, but he warned that it is far from a done deal.
"It’s just in the beginning stages," DiVincenzo said. "There’s a lot of work that has to be done. Every building has to be appraised."
Newark will pay the county between $50,000 and $100,000 to appraise the properties as well as hire their own evaluators.
The plan was first floated by West Ward Councilman Ronald Rice as one of several alternatives to the creation of a municipal utilities authority to manage the city’s water. When the council tabled the MUA, it was left with a $70 million hole in the 2010 budget. That number has grown to $83 million, Amoroso said Tuesday.
Rice said he is glad the administration is working more closely with the council after the failure of the MUA.
"I have to give my colleagues credit. They’re the ones who were emphatic that the administration drill down on these ideas," Rice said. "We were told put up or shut up, so we started putting up."
Sphere: Related Content
Wednesday, August 25, 2010
Monday, August 23, 2010
Accor Agrees to $467 Million Sale Leaseback of 48 Hotels in Europe
Reuters - August 23, 2010
French hotel company Accor (ACCP.PA) agreed to sell 48 hotels in Europe for 367 million euros ($466.7 million) as part of its mission to cut debt and secure growth over the next few years.
The deal, which is due to be completed before the end of this year, will give Accor a cash boost of 282 million euros and will add around 3 million euros to its annual pretax profit from 2010, the hotel group said in a statement on Monday.
The hotels include a Novotel at Munich Airport and a 772-room Ibis at Charles de Gaulle Airport in Paris. The two buyers are insurer Predica, part of Credit Agricole (CAGR.PA), and property group Fonciere des Murs (FERP.PA), a subsidiary of Fonciere des Regions (FDR.PA).
Taken together with previous announcements, the deal means Accor has secured a year-to-date positive cash impact of just over 500 million euros from asset sales, above its current full-year target of 450 million. [ID:nLDE64D0LI]
An Accor spokesman was unavailable for comment. The firm said it would continue to manage the 48 hotels under a 12-year variable lease, renewable six times. Average annual rent will be 19 percent of the hotels' revenue, with a minimum guarantee for 2011 and 2012 of 23 million euros (an initial annual yield of approximately 6.25%).
Accor is eyeing asset sales through 2013 of around 2 billion euros to help fund growth after spinning off its cash-rich services unit Edenred (EDEN.PA) earlier this year.
It is aiming for the world No. 3 spot by 2015 and wants to be Europe's largest franchisor. It is currently world No. 4 after InterContinental (IHG.L), Marriott (MAR.N) and the Hilton and Starwood (HOT.N) chains. Sphere: Related Content
French hotel company Accor (ACCP.PA) agreed to sell 48 hotels in Europe for 367 million euros ($466.7 million) as part of its mission to cut debt and secure growth over the next few years.
The deal, which is due to be completed before the end of this year, will give Accor a cash boost of 282 million euros and will add around 3 million euros to its annual pretax profit from 2010, the hotel group said in a statement on Monday.
The hotels include a Novotel at Munich Airport and a 772-room Ibis at Charles de Gaulle Airport in Paris. The two buyers are insurer Predica, part of Credit Agricole (CAGR.PA), and property group Fonciere des Murs (FERP.PA), a subsidiary of Fonciere des Regions (FDR.PA).
Taken together with previous announcements, the deal means Accor has secured a year-to-date positive cash impact of just over 500 million euros from asset sales, above its current full-year target of 450 million. [ID:nLDE64D0LI]
An Accor spokesman was unavailable for comment. The firm said it would continue to manage the 48 hotels under a 12-year variable lease, renewable six times. Average annual rent will be 19 percent of the hotels' revenue, with a minimum guarantee for 2011 and 2012 of 23 million euros (an initial annual yield of approximately 6.25%).
Accor is eyeing asset sales through 2013 of around 2 billion euros to help fund growth after spinning off its cash-rich services unit Edenred (EDEN.PA) earlier this year.
It is aiming for the world No. 3 spot by 2015 and wants to be Europe's largest franchisor. It is currently world No. 4 after InterContinental (IHG.L), Marriott (MAR.N) and the Hilton and Starwood (HOT.N) chains. Sphere: Related Content
Saturday, August 21, 2010
Aldi Agrees to Sale Leaseback of 80 Retail Outlets in Southern Germany
The Wall Street Journal - August 20, 2010
Insurer Allianz SE (ALV.XE) paid a 'clear three-digit million euros amount' for the 80 retail outlets in southern Germany owned by Aldi Immobilien KG, a person familiar with the matter told Dow Jones Newswires Friday.
Earlier Friday, Allianz, Europe's largest insurer by premium income, said its German real-estate unit is buying 80 retail outlets in southern Germany from Aldi Sued in a leaseback deal aimed at diversifying its investment portfolio.
Aldi, which is one of Germany's largest discount grocery retail chains, will continue to operate the outlets. Aldi Sued is the main long-term lessee of the outlets, which have an average sales area of 900 square meters, Allianz said.
Spokespeople for Allianz Real Estate Germany GmbH and Aldi Sued declined to comment on the transaction value, saying both parties agreed not to disclose the investment details of the deal.
Frank Neumann, a real-estate stock analyst for Bankhaus Lampe, had said he estimates the value of the deal at around EUR80 million.
Aldi Sued operates more than 1,780 retail branches in western and southern Germany. Aldi Nord operates more than 2,500 retail outlets in northern and eastern Germany. Sphere: Related Content
Insurer Allianz SE (ALV.XE) paid a 'clear three-digit million euros amount' for the 80 retail outlets in southern Germany owned by Aldi Immobilien KG, a person familiar with the matter told Dow Jones Newswires Friday.
Earlier Friday, Allianz, Europe's largest insurer by premium income, said its German real-estate unit is buying 80 retail outlets in southern Germany from Aldi Sued in a leaseback deal aimed at diversifying its investment portfolio.
Aldi, which is one of Germany's largest discount grocery retail chains, will continue to operate the outlets. Aldi Sued is the main long-term lessee of the outlets, which have an average sales area of 900 square meters, Allianz said.
Spokespeople for Allianz Real Estate Germany GmbH and Aldi Sued declined to comment on the transaction value, saying both parties agreed not to disclose the investment details of the deal.
Frank Neumann, a real-estate stock analyst for Bankhaus Lampe, had said he estimates the value of the deal at around EUR80 million.
Aldi Sued operates more than 1,780 retail branches in western and southern Germany. Aldi Nord operates more than 2,500 retail outlets in northern and eastern Germany. Sphere: Related Content
Friday, August 20, 2010
Eroski Enters EUR45 Million Sale Leaseback of 21 Grocery Stores in Spain
Property Week - August 18, 2010
Rockspring Property Investment Managers has bought a portfolio of 21 Spanish food stores for €45m.
The fund manager has bought the properties, all in the Basque country and Majorca, in a sale-and leaseback-deal with Spanish food retailer Eroski.
Eroski has signed a 20-year lease on the entire 320,000 sq ft portfolio, which was bought on behalf of the single-client account of a UK pension fund.
The UK pension fund account is targeting un-leveraged core and core plus returns across central and western European retail, office and industrial properties – with a toal spending power of €300m.
James Preston, Rockspring Iberia’s managingdirector, said: “Food retail has proven to be a well performing, defensive sector across Spain both before and during the economic downturn; we are therefore pleased to have secured exposure to this successful asset type.
“These properties appealed to us due to the combination of their prime location, strong local economic fundamentals, sustainable rental levels and the quality of Eroski as a tenant.
“As such, the investment provides a high degree of insulation from any further effects of the downturn, as well as being well positioned for any recovery.”
José Miguel Fernández Astobiza, Eroski’s development manager, said “This portfolio disposal shows further progress in our strategy as we seek to dispose of the freehold interest in our properties in order to release capital to develop our commercial retail activities.”
Cushman & Wakefield advised Eroski and Nicea Abogodas advised Rockspring. Sphere: Related Content
Rockspring Property Investment Managers has bought a portfolio of 21 Spanish food stores for €45m.
The fund manager has bought the properties, all in the Basque country and Majorca, in a sale-and leaseback-deal with Spanish food retailer Eroski.
Eroski has signed a 20-year lease on the entire 320,000 sq ft portfolio, which was bought on behalf of the single-client account of a UK pension fund.
The UK pension fund account is targeting un-leveraged core and core plus returns across central and western European retail, office and industrial properties – with a toal spending power of €300m.
James Preston, Rockspring Iberia’s managingdirector, said: “Food retail has proven to be a well performing, defensive sector across Spain both before and during the economic downturn; we are therefore pleased to have secured exposure to this successful asset type.
“These properties appealed to us due to the combination of their prime location, strong local economic fundamentals, sustainable rental levels and the quality of Eroski as a tenant.
“As such, the investment provides a high degree of insulation from any further effects of the downturn, as well as being well positioned for any recovery.”
José Miguel Fernández Astobiza, Eroski’s development manager, said “This portfolio disposal shows further progress in our strategy as we seek to dispose of the freehold interest in our properties in order to release capital to develop our commercial retail activities.”
Cushman & Wakefield advised Eroski and Nicea Abogodas advised Rockspring. Sphere: Related Content
WP Carey Funds Build to Suit of Logistics Facility for Neuca SA in Poland
The Wall Street Journal - August 17, 2010
Investment firm W. P. Carey & Co. LLC (NYSE: WPC) today announced that its publicly-held, non-traded REIT affiliate, CPA(R):17 - Global, has provided build to suit financing that will fund 100% of the construction and related development costs for a logistics facility in Poznan, Poland being developed by Panattoni Europe. Upon completion, the facility will be owned by CPA(R):17 and will be fully occupied under a long term triple net lease with Neuca SA (formerly known as Torfarm SA), the largest wholesale pharmaceutical distributor in Poland.
The to-be-built facility will comprise approximately 123,000 square feet and will serve as one of Neuca's three strategic logistics sites for pharmaceutical distribution across Poland. The facility is located in Poznan, the 4th largest logistics hub in Poland. Linking seven national and international roads and located midway between Berlin and Warsaw, Poznan forms an important trade-route junction. Construction is anticipated to be completed in January 2011.
Jeff Lefleur, Executive Director of W. P. Carey, said: "Our large capital base and long term investment approach gives us the ability to finance 100% of construction and related development costs in markets where such capital remains challenging for developers to access. We hope to continue being a reliable funding source to experienced developers such as Panattoni for their long term, single-tenant projects. We are also pleased that our financing will help Neuca meet its new facility needs."
Robert Dobrzycki, Managing Partner of Panattoni Europe, noted: "Choosing W. P. Carey as our funding source enabled us to focus on the needs and timing of the project, avoid the risks of relying on short-term borrowing and the process of securing a forward-purchaser, all while eliminating any equity outlay on our part." Sphere: Related Content
Investment firm W. P. Carey & Co. LLC (NYSE: WPC) today announced that its publicly-held, non-traded REIT affiliate, CPA(R):17 - Global, has provided build to suit financing that will fund 100% of the construction and related development costs for a logistics facility in Poznan, Poland being developed by Panattoni Europe. Upon completion, the facility will be owned by CPA(R):17 and will be fully occupied under a long term triple net lease with Neuca SA (formerly known as Torfarm SA), the largest wholesale pharmaceutical distributor in Poland.
The to-be-built facility will comprise approximately 123,000 square feet and will serve as one of Neuca's three strategic logistics sites for pharmaceutical distribution across Poland. The facility is located in Poznan, the 4th largest logistics hub in Poland. Linking seven national and international roads and located midway between Berlin and Warsaw, Poznan forms an important trade-route junction. Construction is anticipated to be completed in January 2011.
Jeff Lefleur, Executive Director of W. P. Carey, said: "Our large capital base and long term investment approach gives us the ability to finance 100% of construction and related development costs in markets where such capital remains challenging for developers to access. We hope to continue being a reliable funding source to experienced developers such as Panattoni for their long term, single-tenant projects. We are also pleased that our financing will help Neuca meet its new facility needs."
Robert Dobrzycki, Managing Partner of Panattoni Europe, noted: "Choosing W. P. Carey as our funding source enabled us to focus on the needs and timing of the project, avoid the risks of relying on short-term borrowing and the process of securing a forward-purchaser, all while eliminating any equity outlay on our part." Sphere: Related Content
Tuesday, August 17, 2010
AMF Bowling Completes £15.2 Million Sale Leaseback of Nine Family Entertainment Centers in UK
Property Magazine International - August 16, 2010
Columbus UK Real Estate Fund, advised by Columbus Capital Management, has completed a purchase and leaseback of nine family entertainment centres from AMF Bowling. This combined with an equity investment from Close Brothers Private Equity (CBPE Capital), has financed AMF’s simultaneous acquisition of its main rival, Hollywood Bowl, from Mitchells and Butler plc.
AMF has acquired the 24 Hollywood Bowl centres for £27 million which, together with the existing 18 AMF centres makes the combined AMF Hollywood business the UK market leader with 42 prime sites across the UK. The AMF management team is highly regarded in the sector and is backed by the shareholders of Bourne Leisure, the owner of Butlins and Haven Holidays.
The nine centres acquired by Columbus range in size from 20,000 sq ft to 30,000 sq ft and are all situated on retail parks or major arterial roads. They are located in Ashford, Maidstone, Torquay, Peterborough, Wellingborough, Shrewsbury, Wigan, Carlisle and Stirling. The units have all been leased back to the combined AMF Hollywood Bowl business for 25 years at an average rent of approximately £6 per sq ft with rent reviews geared to the RPI Index.
The price of approximately £15.2 million reflects an initial yield of 9.3%.
Douglas Stevens & Co and Chester Properties advised Columbus Capital whilst Montague Evans acted for AMF Bowling. Sphere: Related Content
Columbus UK Real Estate Fund, advised by Columbus Capital Management, has completed a purchase and leaseback of nine family entertainment centres from AMF Bowling. This combined with an equity investment from Close Brothers Private Equity (CBPE Capital), has financed AMF’s simultaneous acquisition of its main rival, Hollywood Bowl, from Mitchells and Butler plc.
AMF has acquired the 24 Hollywood Bowl centres for £27 million which, together with the existing 18 AMF centres makes the combined AMF Hollywood business the UK market leader with 42 prime sites across the UK. The AMF management team is highly regarded in the sector and is backed by the shareholders of Bourne Leisure, the owner of Butlins and Haven Holidays.
The nine centres acquired by Columbus range in size from 20,000 sq ft to 30,000 sq ft and are all situated on retail parks or major arterial roads. They are located in Ashford, Maidstone, Torquay, Peterborough, Wellingborough, Shrewsbury, Wigan, Carlisle and Stirling. The units have all been leased back to the combined AMF Hollywood Bowl business for 25 years at an average rent of approximately £6 per sq ft with rent reviews geared to the RPI Index.
The price of approximately £15.2 million reflects an initial yield of 9.3%.
Douglas Stevens & Co and Chester Properties advised Columbus Capital whilst Montague Evans acted for AMF Bowling. Sphere: Related Content
Wednesday, August 11, 2010
Casey's Counters Couche-Tard's Hostile Bid for Casey's 1,500 Store Property Portfolio
Winnipeg Free Press - August 10, 2010
Casey's General Stores says it has armed itself with more than enough cash to finance its self-tender offer against Alimentation Couche-Tard's hostile takeover bid after completing a US$569 million private placement financing.
The placement with a series of insurance companies involves (5.22%) senior unsecured notes due in 2020.
The Iowa-based convenience store company originally planned to use cash on hand and debt to fund the US$500 million recapitalization plan and buy back its shares in a move to raise its stock price and thwart the Couche-Tard offer.
But demand was so strong for the private placement that it will use only debt to purchase 25 per cent of its shares at between US$38 and US$40 each.
The remaining money will be used for fees and expenses in connection with the offer, along with a US$59 million repayment of other senior notes holding a higher interest rate. Any extra funds will be directed at general corporate expenses.
"We are excited that we are able to move forward with our highly accretive recapitalization plan, while maintaining a strong balance sheet and continuing to execute on our strategic initiatives," the company told its employees.
Casey's (Nasdaq:CASY) shareholders have until midnight on Aug. 25 to tender their shares to the company's modified Dutch auction.
Quebec-based Couche-Tard (TSX:ATD.B) extended its US$36.75 per share offer until Aug. 30.
Ben Brownlow, a Casey's analysts with Morgan, Keegan & Company, said he believes Couche-Tard will walk away from the battle by not extending the offer.
"I would be surprised if Couche-Tard went through with a higher offer because if they did so it would be contradictory to their prior trades," he said in an interview.
Brownlow has a US$44 per share target on Casey's shares. He said the recapitalization is very favourable to all shareholders and will lead to a doubling in the return on equity.
Casey's is holding its annual meeting on Sept. 23.
If it doesn't withdraw, Couche-Tard has indicated it plans to nominate eight directors and says it plans to ask shareholders to repeal any bylaws or amendments adopted by the board after June 10, 2009. The move is designed to remove a further roadblock designed to thwart Couche-Tard's takeover plan.
The U.S.-based convenience store operator has urged shareholders to reject both efforts and not use blue proxies sent by Couche-Tard "even in protest."
"Couche-Tard is attempting to utilize the strong balance sheet and real estate position built by Casey’s to subsidize the Couche-Tard Offer and transfer value to Couche-Tard’s shareholders," Casey's said in a proxy filing with the U.S. Securities and Exchange Commission.
Casey's owns 98 per cent of the land and buildings at its 1,500 stores, headquarters and distribution centre. It said Couche-Tard could use this real estate to subsidize its offer through sale-leaseback transactions, as it has done in prior acquisitions.
Couche-Tard declined to comment Tuesday on progress in obtaining financing for its US$1.9 billion takeover. The company has said it is confident about obtaining the financing when required.
But Casey's told its shareholders that its rival has no committed financing more than three months are submitting its offer.
Couche-Tard runs a network of 5,878 convenience stores, 4,146 of which include motor fuel dispensing, across North America.
On the Toronto Stock Exchange, Couche-Tard's shares fell 31 cents at C$21.00 in afternoon trading. Casey's shares were down 19 cents at $38.11 on Nasdaq. Sphere: Related Content
Casey's General Stores says it has armed itself with more than enough cash to finance its self-tender offer against Alimentation Couche-Tard's hostile takeover bid after completing a US$569 million private placement financing.
The placement with a series of insurance companies involves (5.22%) senior unsecured notes due in 2020.
The Iowa-based convenience store company originally planned to use cash on hand and debt to fund the US$500 million recapitalization plan and buy back its shares in a move to raise its stock price and thwart the Couche-Tard offer.
But demand was so strong for the private placement that it will use only debt to purchase 25 per cent of its shares at between US$38 and US$40 each.
The remaining money will be used for fees and expenses in connection with the offer, along with a US$59 million repayment of other senior notes holding a higher interest rate. Any extra funds will be directed at general corporate expenses.
"We are excited that we are able to move forward with our highly accretive recapitalization plan, while maintaining a strong balance sheet and continuing to execute on our strategic initiatives," the company told its employees.
Casey's (Nasdaq:CASY) shareholders have until midnight on Aug. 25 to tender their shares to the company's modified Dutch auction.
Quebec-based Couche-Tard (TSX:ATD.B) extended its US$36.75 per share offer until Aug. 30.
Ben Brownlow, a Casey's analysts with Morgan, Keegan & Company, said he believes Couche-Tard will walk away from the battle by not extending the offer.
"I would be surprised if Couche-Tard went through with a higher offer because if they did so it would be contradictory to their prior trades," he said in an interview.
Brownlow has a US$44 per share target on Casey's shares. He said the recapitalization is very favourable to all shareholders and will lead to a doubling in the return on equity.
Casey's is holding its annual meeting on Sept. 23.
If it doesn't withdraw, Couche-Tard has indicated it plans to nominate eight directors and says it plans to ask shareholders to repeal any bylaws or amendments adopted by the board after June 10, 2009. The move is designed to remove a further roadblock designed to thwart Couche-Tard's takeover plan.
The U.S.-based convenience store operator has urged shareholders to reject both efforts and not use blue proxies sent by Couche-Tard "even in protest."
"Couche-Tard is attempting to utilize the strong balance sheet and real estate position built by Casey’s to subsidize the Couche-Tard Offer and transfer value to Couche-Tard’s shareholders," Casey's said in a proxy filing with the U.S. Securities and Exchange Commission.
Casey's owns 98 per cent of the land and buildings at its 1,500 stores, headquarters and distribution centre. It said Couche-Tard could use this real estate to subsidize its offer through sale-leaseback transactions, as it has done in prior acquisitions.
Couche-Tard declined to comment Tuesday on progress in obtaining financing for its US$1.9 billion takeover. The company has said it is confident about obtaining the financing when required.
But Casey's told its shareholders that its rival has no committed financing more than three months are submitting its offer.
Couche-Tard runs a network of 5,878 convenience stores, 4,146 of which include motor fuel dispensing, across North America.
On the Toronto Stock Exchange, Couche-Tard's shares fell 31 cents at C$21.00 in afternoon trading. Casey's shares were down 19 cents at $38.11 on Nasdaq. Sphere: Related Content
Knight Capital Forms CTL Lending Team
PRNewswire-FirstCall - August 10, 2010
Knight Capital Group, Inc. (NYSE Euronext: KCG) today announced an expansion of ABS/MBS capabilities in commercial real estate finance with the hiring of Barry M. Funt and Winston G. van Buitenen as Managing Directors.
The Commercial Real Estate (CRE) Finance team will leverage Knight's institutional fixed income platform to originate real estate loans for leased-backed and project financings of all types. The team will provide creative structuring advice on transactions that seek to achieve both the economic and qualitative project goals of participating landlords and tenants.
"Barry and Winston bring considerable experience to Knight in the CRE market," said Ronak Khichadia, Managing Director, Global Head of ABS/MBS at Knight Libertas. "Using Knight's extensive client network of leading buy-side firms, they will be able to execute across the credit spectrum, undertake both large and small transaction sizes, structure taxable and tax-exempt real estate financings, and flexibly tailor structures to meet project objectives. Sphere: Related Content
Knight Capital Group, Inc. (NYSE Euronext: KCG) today announced an expansion of ABS/MBS capabilities in commercial real estate finance with the hiring of Barry M. Funt and Winston G. van Buitenen as Managing Directors.
The Commercial Real Estate (CRE) Finance team will leverage Knight's institutional fixed income platform to originate real estate loans for leased-backed and project financings of all types. The team will provide creative structuring advice on transactions that seek to achieve both the economic and qualitative project goals of participating landlords and tenants.
"Barry and Winston bring considerable experience to Knight in the CRE market," said Ronak Khichadia, Managing Director, Global Head of ABS/MBS at Knight Libertas. "Using Knight's extensive client network of leading buy-side firms, they will be able to execute across the credit spectrum, undertake both large and small transaction sizes, structure taxable and tax-exempt real estate financings, and flexibly tailor structures to meet project objectives. Sphere: Related Content
Tuesday, August 10, 2010
Transport for London HQ Sold for £97 Million
Telegraph - August 10, 2010
Pier Walk, which is located next to The O2, has been purchased by Deka, Germany's largest open-ended property fund manager.
TfL moved into the building last August on a 20-year term at £29 per sq ft. The organisation and its 1,800 employees that occupy the office are unaffected by the deal.
Quintain owns the office building with joint venture partner Lend Lease and said it would seek to reinvest the proceeds from the sale into "alternative opportunities with higher potential for value creation".
The company is leading a regeneration of the Greenwich Peninsula and the area surrounding Wembley Stadium in North London. Over the next three years Quintain, which bolstered its balance sheet with a £183m rights issue last year, aims to double assets under management to £2bn and complete the Western part of Wembley City.
The deal for Pier Walk has been struck at 6pc above the last valuation on March 31, providing evidence that a recovery in the commercial property market over the past year can be maintained, despite fears that economic uncertainty may be dampening investor demand.
Figures from property agent CB Richard Ellis published last week showed growth in UK commercial capital values slowed from 0.6pc to 0.4pc in July.
Deka, which has a UK portfolio worth in excess of £1.5bn, said the deal "confirms Deka's commitment to the UK market".
Adrian Wyatt, chief executive of Quintain, added: "This sale achieves three things for Quintain. It fulfils one of our key milestones for the financial year, which together are designed to move the company substantially closer to the achievement of our 2013 business plan. It demonstrates in a difficult market the strength of the independent valuation of our assets at Greenwich Peninsula, and, finally, it enables us to realise the value we have created within the asset and recycle resources into other opportunities with potential for higher returns."
Harm Meijer, property analyst at JP Morgan, said the sale, agreed at a yield of 5.9pc, was "good news" for the company.
Quintain and Lend Lease will retain control of seven retail assets on the ground floor of the building.
Quintain was advised by Savills. Deka's advisers are CB Richard Ellis and Savills. Sphere: Related Content
Pier Walk, which is located next to The O2, has been purchased by Deka, Germany's largest open-ended property fund manager.
TfL moved into the building last August on a 20-year term at £29 per sq ft. The organisation and its 1,800 employees that occupy the office are unaffected by the deal.
Quintain owns the office building with joint venture partner Lend Lease and said it would seek to reinvest the proceeds from the sale into "alternative opportunities with higher potential for value creation".
The company is leading a regeneration of the Greenwich Peninsula and the area surrounding Wembley Stadium in North London. Over the next three years Quintain, which bolstered its balance sheet with a £183m rights issue last year, aims to double assets under management to £2bn and complete the Western part of Wembley City.
The deal for Pier Walk has been struck at 6pc above the last valuation on March 31, providing evidence that a recovery in the commercial property market over the past year can be maintained, despite fears that economic uncertainty may be dampening investor demand.
Figures from property agent CB Richard Ellis published last week showed growth in UK commercial capital values slowed from 0.6pc to 0.4pc in July.
Deka, which has a UK portfolio worth in excess of £1.5bn, said the deal "confirms Deka's commitment to the UK market".
Adrian Wyatt, chief executive of Quintain, added: "This sale achieves three things for Quintain. It fulfils one of our key milestones for the financial year, which together are designed to move the company substantially closer to the achievement of our 2013 business plan. It demonstrates in a difficult market the strength of the independent valuation of our assets at Greenwich Peninsula, and, finally, it enables us to realise the value we have created within the asset and recycle resources into other opportunities with potential for higher returns."
Harm Meijer, property analyst at JP Morgan, said the sale, agreed at a yield of 5.9pc, was "good news" for the company.
Quintain and Lend Lease will retain control of seven retail assets on the ground floor of the building.
Quintain was advised by Savills. Deka's advisers are CB Richard Ellis and Savills. Sphere: Related Content
Monday, August 09, 2010
Proposed Accounting Changes Could Make Long Term Leases Scarce (and More Valuable)
Real Capital Analytics Website - August 5, 2010
Sweeping changes proposed in the accounting treatment of leases will have steep implications for investors should they take effect in the next few years. Just how great the resulting impact is up for debate, but implementation would compel many tenants to avoid making long term lease arrangements. For real estate investors, the potential implications loom large, and could have a profound impact for those with strategies that include single-tenant properties and sale-leasebacks, both large segments of the property markets.
Over the past 12 months, 23% of all commercial property trades globally, or $46.6 billion in assets, have involved single-tenant properties. By number of properties sold, the proportion of single-tenant properties changing hands is much higher, at close to 40%, up from 25% before the downturn. Investors typically flock to the security of single-tenant properties, particularly those with long-term credit tenants when economic conditions stumble.
The proposed regulations, part of an ongoing effort between US and international accounting bodies to converge global standards and provide greater financial transparency, would essentially require tenants to report all leases as liabilities. The March 2009 discussion paper is available from the Financial Accounting Standards Board (FASB). Instead of reporting rent as an operating expense, occupiers would have to book the value of the lease as a liability using the full term of the lease, including renewal options. The added liability could endanger existing debt covenants or be a hurdle for companies looking to raise credit. And so while some in the market will argue that accounting treatment does not impact underlying economics, practical issues do arise.
The primary concern for real estate owners is that tenants will opt for shorter lease terms – the longer the lease, the greater the liability a company would have to book. In addition, more companies are likely to buy and own their properties outright. Indeed, the proposals are already coming into play. When aerospace contractor Northrop Grumman announced that it will acquire a vacant 334,000-square-foot building for its headquarters just outside of Washington DC, it cited these potential accounting changes as a factor behind the decision.
The most vulnerable part of the property sector may be sale-leaseback transactions, where the seller/occupier is required to execute a long term lease. These have accounted for $24.8 billion, or just over 50%, of all single-tenant deals over $10 million globally over the past year. Over the same period, there have been $4.0 billion of sale-leaseback transactions in the United States, representing just under 40% of all single-tenant deals domestically.
Corporations that found traditional credit routes frozen often turned to sale-leasebacks to raise capital, and top-rated companies often use the sale-leaseback market as a vital component of their corporate finance strategy. The top ten companies engaged in the practice have used it to raise $30.0 billion globally since the start of 2007.
Although the changes have not been finalized by FASB and the International Accounting Standards Boards (IASB), most experts believe that some changes to current standards are inevitable and will take effect as early as 2012. A final draft is expected to be published for comment this fall. As the date for implementation moves nearer, single-tenant properties with long-term leases are sure to gain in desirability and value, since with adoption, long-term leases could become scarce. Sphere: Related Content
Sweeping changes proposed in the accounting treatment of leases will have steep implications for investors should they take effect in the next few years. Just how great the resulting impact is up for debate, but implementation would compel many tenants to avoid making long term lease arrangements. For real estate investors, the potential implications loom large, and could have a profound impact for those with strategies that include single-tenant properties and sale-leasebacks, both large segments of the property markets.
Over the past 12 months, 23% of all commercial property trades globally, or $46.6 billion in assets, have involved single-tenant properties. By number of properties sold, the proportion of single-tenant properties changing hands is much higher, at close to 40%, up from 25% before the downturn. Investors typically flock to the security of single-tenant properties, particularly those with long-term credit tenants when economic conditions stumble.
The proposed regulations, part of an ongoing effort between US and international accounting bodies to converge global standards and provide greater financial transparency, would essentially require tenants to report all leases as liabilities. The March 2009 discussion paper is available from the Financial Accounting Standards Board (FASB). Instead of reporting rent as an operating expense, occupiers would have to book the value of the lease as a liability using the full term of the lease, including renewal options. The added liability could endanger existing debt covenants or be a hurdle for companies looking to raise credit. And so while some in the market will argue that accounting treatment does not impact underlying economics, practical issues do arise.
The primary concern for real estate owners is that tenants will opt for shorter lease terms – the longer the lease, the greater the liability a company would have to book. In addition, more companies are likely to buy and own their properties outright. Indeed, the proposals are already coming into play. When aerospace contractor Northrop Grumman announced that it will acquire a vacant 334,000-square-foot building for its headquarters just outside of Washington DC, it cited these potential accounting changes as a factor behind the decision.
The most vulnerable part of the property sector may be sale-leaseback transactions, where the seller/occupier is required to execute a long term lease. These have accounted for $24.8 billion, or just over 50%, of all single-tenant deals over $10 million globally over the past year. Over the same period, there have been $4.0 billion of sale-leaseback transactions in the United States, representing just under 40% of all single-tenant deals domestically.
Corporations that found traditional credit routes frozen often turned to sale-leasebacks to raise capital, and top-rated companies often use the sale-leaseback market as a vital component of their corporate finance strategy. The top ten companies engaged in the practice have used it to raise $30.0 billion globally since the start of 2007.
Although the changes have not been finalized by FASB and the International Accounting Standards Boards (IASB), most experts believe that some changes to current standards are inevitable and will take effect as early as 2012. A final draft is expected to be published for comment this fall. As the date for implementation moves nearer, single-tenant properties with long-term leases are sure to gain in desirability and value, since with adoption, long-term leases could become scarce. Sphere: Related Content
Sunday, August 08, 2010
Debenhams Mulls Sale Leaseback of UK Store Portfolio
New Statesman - August 5, 2010
In a bid to generate capital, department store group Debenhams has held discussions about unlocking the value in its property portfolio, in a move to reduce its debt which stood at £927m last year.
Debenhams has been speaking to potential investors over deals for nine of its stores. Reports suggest that the group, which owns 165 stores in the UK and Ireland, is contemplating a sale and lease back deal over a period of 25 years.
In April 2010, Debenhams had stated that its net debt had been brought down by 45 per cent to the tune of £512m. In addition, it signed a £650m credit facility last month towards refinancing its debt.
Debenhams is said to have held discussions with property consultants King Sturge about facilitating the process. No comment has been forthcoming yet from either company.
Reports also suggest that the group could direct the capital from the property deals into further investments in business, such as its recent acquisition of footwear chain Faith. Sphere: Related Content
In a bid to generate capital, department store group Debenhams has held discussions about unlocking the value in its property portfolio, in a move to reduce its debt which stood at £927m last year.
Debenhams has been speaking to potential investors over deals for nine of its stores. Reports suggest that the group, which owns 165 stores in the UK and Ireland, is contemplating a sale and lease back deal over a period of 25 years.
In April 2010, Debenhams had stated that its net debt had been brought down by 45 per cent to the tune of £512m. In addition, it signed a £650m credit facility last month towards refinancing its debt.
Debenhams is said to have held discussions with property consultants King Sturge about facilitating the process. No comment has been forthcoming yet from either company.
Reports also suggest that the group could direct the capital from the property deals into further investments in business, such as its recent acquisition of footwear chain Faith. Sphere: Related Content
Monday, August 02, 2010
MGM Resorts Agrees to $80 Million Sale Leaseback of Ground Under Borgata Casino in Atlantic City
Wall Street Journal - July 28, 2010
As part of its exit strategy from Atlantic City, MGM Resorts International is selling about $80 million of land to a partnership led by Vornado Realty Trust, one of the largest commercial real-estate owners in the country, people familiar with the matter said Tuesday.
The four parcels the Vornado group is buying from MGM Resorts are connected to the Borgata Hotel Casino & Spa in Atlantic City, N.J.
New Jersey-based Vornado is buying four pieces of land connected to the Borgata Hotel Casino & Spa, including parcels underneath an 800-room hotel, convention center and parking garage. The owner of the land collects rent from a venture of MGM and Boyd Gaming Corp., which owns the hotel, garage and other buildings on the land.
The Las Vegas-style Borgata, one of Atlantic City, N.J.'s most popular casinos, which also is owned jointly by MGM and Boyd, wasn't part of the purchase. Representatives for Vornado and MGM declined to comment.
The deal marks the first wave of asset sales under an MGM agreement with the state of New Jersey's Division of Gaming Enforcement, approved in March, in which MGM promised to sell most of its Atlantic City assets in 18 months. The division required this because it believes MGM has a business partner in Macau with ties to organized crime. MGM has denied this.
In the wake of the agreement with the state, MGM placed its 50% stake in the casino, the four parcels and other assets in a divestiture trust with the company as the sole beneficiary. The sale to Vornado is the first deal out of that trust.
The deal with Vornado is an unusual step for the real-estate giant, one of the country's largest landlords of retail and office space. Vornado is making its first entrance into the Atlantic City market during one of the gambling town's most brutal downturns. The market has been hurt as cash-strapped gamblers stay away amid the recession, or go to casinos and slot parlors closer to home in Pennsylvania and New York.
Casino revenue plunged to $3.9 billion in 2009, the lowest level since 1997, from a high of $5.2 billion in 2006. Employment dropped from 50,000 to 38,000 jobs. Earlier this month, New Jersey Gov. Chris Christie proposed a state takeover of the Atlantic City casino district to salvage the industry.
Vornado's investment is relatively safe, though, because the Borgata has consistently outperformed the other 10 casinos. But, it has seen its share of revenue declines, including an 11.7% drop in June versus a year earlier. Sphere: Related Content
As part of its exit strategy from Atlantic City, MGM Resorts International is selling about $80 million of land to a partnership led by Vornado Realty Trust, one of the largest commercial real-estate owners in the country, people familiar with the matter said Tuesday.
The four parcels the Vornado group is buying from MGM Resorts are connected to the Borgata Hotel Casino & Spa in Atlantic City, N.J.
New Jersey-based Vornado is buying four pieces of land connected to the Borgata Hotel Casino & Spa, including parcels underneath an 800-room hotel, convention center and parking garage. The owner of the land collects rent from a venture of MGM and Boyd Gaming Corp., which owns the hotel, garage and other buildings on the land.
The Las Vegas-style Borgata, one of Atlantic City, N.J.'s most popular casinos, which also is owned jointly by MGM and Boyd, wasn't part of the purchase. Representatives for Vornado and MGM declined to comment.
The deal marks the first wave of asset sales under an MGM agreement with the state of New Jersey's Division of Gaming Enforcement, approved in March, in which MGM promised to sell most of its Atlantic City assets in 18 months. The division required this because it believes MGM has a business partner in Macau with ties to organized crime. MGM has denied this.
In the wake of the agreement with the state, MGM placed its 50% stake in the casino, the four parcels and other assets in a divestiture trust with the company as the sole beneficiary. The sale to Vornado is the first deal out of that trust.
The deal with Vornado is an unusual step for the real-estate giant, one of the country's largest landlords of retail and office space. Vornado is making its first entrance into the Atlantic City market during one of the gambling town's most brutal downturns. The market has been hurt as cash-strapped gamblers stay away amid the recession, or go to casinos and slot parlors closer to home in Pennsylvania and New York.
Casino revenue plunged to $3.9 billion in 2009, the lowest level since 1997, from a high of $5.2 billion in 2006. Employment dropped from 50,000 to 38,000 jobs. Earlier this month, New Jersey Gov. Chris Christie proposed a state takeover of the Atlantic City casino district to salvage the industry.
Vornado's investment is relatively safe, though, because the Borgata has consistently outperformed the other 10 casinos. But, it has seen its share of revenue declines, including an 11.7% drop in June versus a year earlier. Sphere: Related Content
BlackRock HQ in London Under Agreement for $391 Million
Bloomberg - July 30, 2010
The co-owner of the London tower known as the Gherkin says the time is right to buy more offices in the U.K. capital and is about to make its biggest acquisition since 2007.
Evans Randall Ltd. will pay as much as 250 million pounds ($391 million) in the next few weeks for offices in Drapers Gardens, Michael Evans, the closely held investment bank’s founder and chairman, said in an interview. The building in the City of London, the main financial district, is owned by Morgan Stanley, Canary Wharf Group Plc and Exemplar Properties and leased by BlackRock Inc.
Evans Randall could spend as much as 1.5 billion pounds in a year to buy more central London properties, as it seeks to profit from rising demand for modern space, Evans said. City of London office values have rebounded 19 percent in the past 10 months, following a two-year slump that wiped 45 percent off prices, according to Investment Property Databank Ltd. A shortage of new developments is pushing up rents as companies recruit more staff.
“Now is the time to buy the best quality assets if we can get our hands on them,” said Evans, 57. “The pound is very weak, interest rates are at a record low, rental demand is at an exceptional level -- the best at any time since 2006.”
BlackRock, the world’s biggest asset manager, has a 25-year lease on Drapers Gardens, a 270,000 square-foot (25,100 square- meter) building near the Bank of England. Deka Immobilien, the real estate unit of Frankfurt-based Dekabank Deutsche Girozentrale, pulled out of an agreement to buy the site for about 240 million pounds in June, according to a report last month in Property Week. Sphere: Related Content
The co-owner of the London tower known as the Gherkin says the time is right to buy more offices in the U.K. capital and is about to make its biggest acquisition since 2007.
Evans Randall Ltd. will pay as much as 250 million pounds ($391 million) in the next few weeks for offices in Drapers Gardens, Michael Evans, the closely held investment bank’s founder and chairman, said in an interview. The building in the City of London, the main financial district, is owned by Morgan Stanley, Canary Wharf Group Plc and Exemplar Properties and leased by BlackRock Inc.
Evans Randall could spend as much as 1.5 billion pounds in a year to buy more central London properties, as it seeks to profit from rising demand for modern space, Evans said. City of London office values have rebounded 19 percent in the past 10 months, following a two-year slump that wiped 45 percent off prices, according to Investment Property Databank Ltd. A shortage of new developments is pushing up rents as companies recruit more staff.
“Now is the time to buy the best quality assets if we can get our hands on them,” said Evans, 57. “The pound is very weak, interest rates are at a record low, rental demand is at an exceptional level -- the best at any time since 2006.”
BlackRock, the world’s biggest asset manager, has a 25-year lease on Drapers Gardens, a 270,000 square-foot (25,100 square- meter) building near the Bank of England. Deka Immobilien, the real estate unit of Frankfurt-based Dekabank Deutsche Girozentrale, pulled out of an agreement to buy the site for about 240 million pounds in June, according to a report last month in Property Week. Sphere: Related Content
Stag Capital Readies IPO of Single Tenant Industrial REIT
Citybizlist Baltimore - July 29, 2010
Readying the stage for an IPO launch, Stag Industrial Inc. is sizing up $450 million of potential acquisitions while making plans for an opening play that calls for the purchase of 26 properties for $165 million from an affiliate fund and 75 properties in exchange for partnership units.
By year's end, the Boston-based investment group plans to be operating as a REIT. Through various affiliates, Stag owns 101 properties in 24 states, all single-tenant assets leased to 84 companies with an average weighted in-place lease term of five years, according to an SEC filing. The portfolio is 93.7 percent leased to 84 tenants.
Stag's 10 largest tenants are Bank of America, with five leases; Busche Enterprises, eight; Thyssen Krupp, four; Ohio Wholesale, two; and Verizon New England, American Beverage, Stream International, Woodbridge Venture, Brown Group and Wausau Paper, all with one location apiece. The companies' 25 locations account for 3.46 million square feet of the Stag portfolio and generate $14.35 million of annualized rent, which represents 27.9 percent of the portfolio's total rent revenue.
Stag Industrial will target acquisitions in secondary markets in the U.S. in the $5 million to $20 million range. Of those in its sights, 74 percent of properties are warehouse/distribution; 17 percent are manufacturing; and 9 percent are flex/office. "We believe that a significant portion of the 14 billion square feet of industrial space in the United States falls within our target investment criteria and that there will be ample supply of suitable acquisition opportunities," according to the SEC filing.
Stag Industrial is being formed to acquire the assets and operations of its predecessor business, which has deployed more than $1.2 billion to acquire in excess of 200 properties since 2003. The assets were bought through four private equity funds: SCP Green LLC (Fund I) , Fund II, Fund III and Fund IV.
All Fund I properties were sold in 2006. The following year, Fund II sold 16 properties and still owns 91. Stag Industrial will be seeded by 26 properties from Fund II. Fund II's remaining portfolio will not be transferred and will continue operations as-is, but not make any additional acquisitions going forward.
Funds III and VI will contribute 75 properties in formation transactions in exchange for common units. Also after the IPO launch, Stag Industrial will acquire another 890,891 square feet in three vacant properties, with Fund III retaining ownership. The new REIT will be given five years to exercise a purchase option.
Following the REIT's formation, the funds and affiliate Stag GI will make no additional acquisitions. With the proceeds of its offering, Stag Industrial plans to use about $58.3 million to satisfy principal mortgage debt secured by the properties being transferred. Sphere: Related Content
Readying the stage for an IPO launch, Stag Industrial Inc. is sizing up $450 million of potential acquisitions while making plans for an opening play that calls for the purchase of 26 properties for $165 million from an affiliate fund and 75 properties in exchange for partnership units.
By year's end, the Boston-based investment group plans to be operating as a REIT. Through various affiliates, Stag owns 101 properties in 24 states, all single-tenant assets leased to 84 companies with an average weighted in-place lease term of five years, according to an SEC filing. The portfolio is 93.7 percent leased to 84 tenants.
Stag's 10 largest tenants are Bank of America, with five leases; Busche Enterprises, eight; Thyssen Krupp, four; Ohio Wholesale, two; and Verizon New England, American Beverage, Stream International, Woodbridge Venture, Brown Group and Wausau Paper, all with one location apiece. The companies' 25 locations account for 3.46 million square feet of the Stag portfolio and generate $14.35 million of annualized rent, which represents 27.9 percent of the portfolio's total rent revenue.
Stag Industrial will target acquisitions in secondary markets in the U.S. in the $5 million to $20 million range. Of those in its sights, 74 percent of properties are warehouse/distribution; 17 percent are manufacturing; and 9 percent are flex/office. "We believe that a significant portion of the 14 billion square feet of industrial space in the United States falls within our target investment criteria and that there will be ample supply of suitable acquisition opportunities," according to the SEC filing.
Stag Industrial is being formed to acquire the assets and operations of its predecessor business, which has deployed more than $1.2 billion to acquire in excess of 200 properties since 2003. The assets were bought through four private equity funds: SCP Green LLC (Fund I) , Fund II, Fund III and Fund IV.
All Fund I properties were sold in 2006. The following year, Fund II sold 16 properties and still owns 91. Stag Industrial will be seeded by 26 properties from Fund II. Fund II's remaining portfolio will not be transferred and will continue operations as-is, but not make any additional acquisitions going forward.
Funds III and VI will contribute 75 properties in formation transactions in exchange for common units. Also after the IPO launch, Stag Industrial will acquire another 890,891 square feet in three vacant properties, with Fund III retaining ownership. The new REIT will be given five years to exercise a purchase option.
Following the REIT's formation, the funds and affiliate Stag GI will make no additional acquisitions. With the proceeds of its offering, Stag Industrial plans to use about $58.3 million to satisfy principal mortgage debt secured by the properties being transferred. Sphere: Related Content
Sobeys Agrees to $102 Million Sale Leaseback of Retail Portfolio Across Canada
Daily Commercial News - July 8, 2010
Crombie Real Estate Investment Trust ("Crombie") (TSX:CRR.UN) announced today that it has entered into a non-binding letter of intent for the acquisition of $102 million of Canadian retail properties with Sobeys (a wholly owned subsidiary of Empire Company Limited ("Empire") (TSX:EMP.A)) comprising a portfolio of 11 retail properties (the "Portfolio"). The Portfolio totals approximately 496,630 square feet and consists of eight properties located in Western Canada, two in Ontario and one in Atlantic Canada.
Crombie has also entered into an agreement with a syndicate of underwriters co-led by CIBC World Markets Inc. and TD Securities Inc., to issue, on a bought-deal basis, 2,670,000 units (the "Units") at a price of $11.05 per unit for gross proceeds of approximately $29.5 million. Concurrently, ECL Developments Limited (a wholly owned subsidiary of Empire) in satisfaction of its pre-emptive right with respect to the public Unit offering will subscribe for 1,855,000 Exchangeable LP Units at a price of $11.05 per unit for additional gross proceeds of $20.5 million. The total $50 million offering is subject to regulatory approval.
Crombie intends to use the net proceeds from this offering to fund in part the acquisition of the Portfolio, additional acquisitions to be completed later in 2010 and for general trust purposes. The Sobeys portfolio acquisition is subject to completion of a definitive agreement and normal due diligence.
The Portfolio is 100% leased and comprised of six freestanding Sobeys stores, four freestanding Sobeys stores with retail pads; and one Sobeys anchored plaza. Sobeys, Canada's second largest retail grocer will occupy approximately 95% of the total acquired space on lease terms averaging 20 years. The acquisition price represents a going in capitalization rate of approximately 7.7%. Sphere: Related Content
Crombie Real Estate Investment Trust ("Crombie") (TSX:CRR.UN) announced today that it has entered into a non-binding letter of intent for the acquisition of $102 million of Canadian retail properties with Sobeys (a wholly owned subsidiary of Empire Company Limited ("Empire") (TSX:EMP.A)) comprising a portfolio of 11 retail properties (the "Portfolio"). The Portfolio totals approximately 496,630 square feet and consists of eight properties located in Western Canada, two in Ontario and one in Atlantic Canada.
Crombie has also entered into an agreement with a syndicate of underwriters co-led by CIBC World Markets Inc. and TD Securities Inc., to issue, on a bought-deal basis, 2,670,000 units (the "Units") at a price of $11.05 per unit for gross proceeds of approximately $29.5 million. Concurrently, ECL Developments Limited (a wholly owned subsidiary of Empire) in satisfaction of its pre-emptive right with respect to the public Unit offering will subscribe for 1,855,000 Exchangeable LP Units at a price of $11.05 per unit for additional gross proceeds of $20.5 million. The total $50 million offering is subject to regulatory approval.
Crombie intends to use the net proceeds from this offering to fund in part the acquisition of the Portfolio, additional acquisitions to be completed later in 2010 and for general trust purposes. The Sobeys portfolio acquisition is subject to completion of a definitive agreement and normal due diligence.
The Portfolio is 100% leased and comprised of six freestanding Sobeys stores, four freestanding Sobeys stores with retail pads; and one Sobeys anchored plaza. Sobeys, Canada's second largest retail grocer will occupy approximately 95% of the total acquired space on lease terms averaging 20 years. The acquisition price represents a going in capitalization rate of approximately 7.7%. Sphere: Related Content
Friday, July 30, 2010
BBVA Closes EUR 364 Million Sale Leaseback of Property Portfolio in Spain
PropertyEU - July 30, 2010
A consortium of Deutsche Bank's RREEF Europe, Area Property Partners and Europa Capital has announced that it has completed the EUR 364 mln acquisition of a second portfolio of Spanish property assets owned by Banco Bilbao Vizcaya Argentaria (BBVA). The investment volume reflects an initial yield of 6.5%.
The assets, comprising five office assets and 153 bank branches located throughout Spain, will be leased back to BBVA on a long-term basis. REEF Spezialfonds acquired three of the office properties.
In September last year the consortium led by RREEF completed the sale-and-leaseback of the majority of the bank's Spanish assets for EUR 1.15 bn. That sale, which reflected a yield of about 7%, covered three office buildings and 944 bank branches.
The second deal completes the disposal of BBVA's Spanish assets.
Carlos Portocarrero de las Heras, partner at Clifford Chance Madrid who represented BBVA, said the second tranche was 'slightly easier' to close then the first, given the improving market conditions and the ability to use the largest disposal as a model. BBVA still owns about 500 properties in Spain in order to retain the option of swapping assets for ones covered under the sale-and-leaseback agreements when necessary, he added.
Ismael Clemente, head of RREEF Spain, told PropertyEU that the terms and conditions underlying both deals are similar. The office properties are being leased by BBVA for 20-year terms and the bank branches for 30 years.
In a statement on the transaction, Clemente added: 'We are extremely satisfied of the successful closing of this second tranche. We would like to thank our partners AREA, Europa and March for their continued support and confidence in our management capacity up to now. We would also thank our colleagues of RREEF Spezialfonds in Germany for having made their first acquisition in Spain in the framework of this transaction. It is an excellent opportunity for our investors, since we acquire on their behalf very good quality assets in prime locations with a proven and solid tenant'.
A full report on the deal will be published in the September edition of PropertyEU Magazine. Sphere: Related Content
A consortium of Deutsche Bank's RREEF Europe, Area Property Partners and Europa Capital has announced that it has completed the EUR 364 mln acquisition of a second portfolio of Spanish property assets owned by Banco Bilbao Vizcaya Argentaria (BBVA). The investment volume reflects an initial yield of 6.5%.
The assets, comprising five office assets and 153 bank branches located throughout Spain, will be leased back to BBVA on a long-term basis. REEF Spezialfonds acquired three of the office properties.
In September last year the consortium led by RREEF completed the sale-and-leaseback of the majority of the bank's Spanish assets for EUR 1.15 bn. That sale, which reflected a yield of about 7%, covered three office buildings and 944 bank branches.
The second deal completes the disposal of BBVA's Spanish assets.
Carlos Portocarrero de las Heras, partner at Clifford Chance Madrid who represented BBVA, said the second tranche was 'slightly easier' to close then the first, given the improving market conditions and the ability to use the largest disposal as a model. BBVA still owns about 500 properties in Spain in order to retain the option of swapping assets for ones covered under the sale-and-leaseback agreements when necessary, he added.
Ismael Clemente, head of RREEF Spain, told PropertyEU that the terms and conditions underlying both deals are similar. The office properties are being leased by BBVA for 20-year terms and the bank branches for 30 years.
In a statement on the transaction, Clemente added: 'We are extremely satisfied of the successful closing of this second tranche. We would like to thank our partners AREA, Europa and March for their continued support and confidence in our management capacity up to now. We would also thank our colleagues of RREEF Spezialfonds in Germany for having made their first acquisition in Spain in the framework of this transaction. It is an excellent opportunity for our investors, since we acquire on their behalf very good quality assets in prime locations with a proven and solid tenant'.
A full report on the deal will be published in the September edition of PropertyEU Magazine. Sphere: Related Content
Monday, July 26, 2010
Study Released on Real Estate Sale Leaseback Transactions in the U.S.
The Journal of Real Estate Research (via Zicklin School of Business at Baruch College
C.F. Sirmans of Florida State University and Barrett A. Slade of Brigham Young University have just published a research paper in the current issue of The Journal of Real Estate Research on the pricing of sale leaseback transactions in the United States. The report is entitled "Sale-Leaseback Transactions: Price Premiums and Market Efficiency." An abstract of the paper is provided below. The entire paper can be downloaded here.
Sale-leaseback transactions are ubiquitous in real estate markets in the United States with annual volume estimated to be greater than $7 billion. However, there is no evidence concerning the price impact of such transactional arrangements. Using a data set of sale-leaseback transactions, this study examines the price impact on commercial property transactions across seven markets. The findings reveal that transactions structured as sale-leasebacks occur at significantly higher prices than market transactions. In addition, after accounting for income differentials, buyers and sellers are appropriately pricing the transactions resulting in no undue advantage to either party, that is, the expected price premium is accounted for in the sale-leaseback prices. Sphere: Related Content
C.F. Sirmans of Florida State University and Barrett A. Slade of Brigham Young University have just published a research paper in the current issue of The Journal of Real Estate Research on the pricing of sale leaseback transactions in the United States. The report is entitled "Sale-Leaseback Transactions: Price Premiums and Market Efficiency." An abstract of the paper is provided below. The entire paper can be downloaded here.
Sale-leaseback transactions are ubiquitous in real estate markets in the United States with annual volume estimated to be greater than $7 billion. However, there is no evidence concerning the price impact of such transactional arrangements. Using a data set of sale-leaseback transactions, this study examines the price impact on commercial property transactions across seven markets. The findings reveal that transactions structured as sale-leasebacks occur at significantly higher prices than market transactions. In addition, after accounting for income differentials, buyers and sellers are appropriately pricing the transactions resulting in no undue advantage to either party, that is, the expected price premium is accounted for in the sale-leaseback prices. Sphere: Related Content
Mesirow Forms CTL Lending Group
Private Placement Letter (via StructuredFinanceNews.com) - July 15, 2010
Mesirow Financial has hired industry veteran Stephen Jacobson to build and lead its credit tenant lease (CTL) team, the company said.
Jacobson serves as a senior managing director in the global markets group for the CTL product. He joins from William Blair, where he spent 15 years and established that firm's CTL group. Prior to his 20-year career at William Blair, Jacobson was involved in public finance, focused on the New England area.
Mesirow is in the process of building its own team and plans to have a minimum of four originators, Jacobson told ASR sister publication Private Placement Letter. These individuals will compliment the fixed-income sales and trading group, which is made up of 120 representatives. Mesirow is actively soliciting and attempting to gain CTL placement mandates, he said.
CTLs provide financing to owners of single tenant commercial properties located in the U.S. The loan is secured based on the underlying lease and the financed property. Furthermore, the tenants are investment-grade credits. The CTL market follows the schedule of the NAIC and does not extend credit to tenants rated less than 'BBB-', Jacobson said.
"The investment market for CTL placements is ripe due to lenders seeking higher yielding investment grade products," Jacobson said, which is one of the reasons Mesirow has started a CTL group. During 2007 and 2008, the CTL market lost business to CMBS.
After the decline of CMBS products, CTLs are once again gaining favor and are experiencing an increase in institutional demand, he said. Additionally, since CTL transactions are done via private placements, investors typically see higher yields than they do for public offerings of the same credits.
Chicago-based Mesirow Financial is a diversified financial services firm. It has in excess of $40 billion in assets under management and specializes in investment management, global markets, insurance services and consulting. Sphere: Related Content
Mesirow Financial has hired industry veteran Stephen Jacobson to build and lead its credit tenant lease (CTL) team, the company said.
Jacobson serves as a senior managing director in the global markets group for the CTL product. He joins from William Blair, where he spent 15 years and established that firm's CTL group. Prior to his 20-year career at William Blair, Jacobson was involved in public finance, focused on the New England area.
Mesirow is in the process of building its own team and plans to have a minimum of four originators, Jacobson told ASR sister publication Private Placement Letter. These individuals will compliment the fixed-income sales and trading group, which is made up of 120 representatives. Mesirow is actively soliciting and attempting to gain CTL placement mandates, he said.
CTLs provide financing to owners of single tenant commercial properties located in the U.S. The loan is secured based on the underlying lease and the financed property. Furthermore, the tenants are investment-grade credits. The CTL market follows the schedule of the NAIC and does not extend credit to tenants rated less than 'BBB-', Jacobson said.
"The investment market for CTL placements is ripe due to lenders seeking higher yielding investment grade products," Jacobson said, which is one of the reasons Mesirow has started a CTL group. During 2007 and 2008, the CTL market lost business to CMBS.
After the decline of CMBS products, CTLs are once again gaining favor and are experiencing an increase in institutional demand, he said. Additionally, since CTL transactions are done via private placements, investors typically see higher yields than they do for public offerings of the same credits.
Chicago-based Mesirow Financial is a diversified financial services firm. It has in excess of $40 billion in assets under management and specializes in investment management, global markets, insurance services and consulting. Sphere: Related Content
Credit Tenant Leases: The Phoenix Rises
Private Placement Letter (via StructuredFinanceNews.com) - July 23, 2010
CMBS' loss seems to be the credit tenant lease (CTL) market’s gain. The latter has shown robust growth in the face of the financial crisis and in its aftermath, mainly owing to the shutdown of the CMBS and conduit markets.
“The stars have been in alignment, and we did noticed that the CTL market was picking up steam in 2009,” said Michael Kalt, managing director and head of William Blair’s CTL group. The CTL market provides financing for investment-grade, single-tenant commercial real estate, where the loan is secured based on the underlying lease and the financed property.
These issuers, which normally would have turned to the CMBS and conduit markets, were left with limited options when the real estate bubble burst. The CTL market has also started to offer relatively attractive spreads and has become a more common form of funding than MBS, said Benjamin Harris, managing director and head of domestic investments at C.P. Carey.
Retail credit/tenants such as Walgreens, Home Depot, Lowes and CVS have participated in CTL deals. In June, alcoholic beverage company Diageo was involved in a $269 million deal, wherein a public REIT purchased a portfolio of vineyards from Diageo in a sale and leaseback and financed this with proceeds from a CTL transaction, Harris said. Federal, state and local governments, and not-for-profit health-care organizations have been getting more active in this market as well, Kalt added.
And the CTL market continues to flourish, because the other forms of financing it would normally compete against have yet to fully bounce back from the financial crisis. In addition to the CMBS market, banks and life insurance companies used to lend to these credit/tenants, but those forms of lending have yet to return to peak levels. Mortgage REITs also continue to suffer. Additionally, some specialty companies that were players in the CTL space have exited. GE Capital is one such example.
Holders of CTL paper also have some benefits over other securities, some say. “It is my argument that CTLs can be better than senior secured notes. Two years ago when liquidity evaporated it didn’t matter what you owned,” said Thomas Sargent, managing partner at Bostonia Global Securities. Furthermore, in the case of a bankruptcy, CTL paper often holds up better compared with senior unsecured notes, he added.
Kalt agreed, saying from an investor’s perspective a CTL investment allows for exposure to credit but still gives a secured interest in real estate. However, they also offer a lower debt service coverage ratios and from a liquidity perspective, CTL paper and plain vanilla private placements are about the same.
Furthermore, spreads on CTL deals are also attractive, sources agree. Yet, pricing one such transaction is not as simple as applying a constant spread over a comparable public bond issue, Kalt notes. In the CTL market, price boils down to industry, sector and credit, in addition to credit exposure on the buy side and the overall transaction structure. For instance, a healthcare 'AA' credit will be viewed differently from a government AA credit, or a corporate AA credit, he said. In the CTL market an NIAC-1 will not be price comparable across the spectrum of sectors.
Additionally, Harris said, pricing is driven by where the corporate bonds of a particular company are trading. These prices will also include an illiquidity premium of about 25 basis points or 50 basis points.
It is difficult to estimate the total volume of the CTL market because the deals are done through private placements, sources say. But they agree that issuance so far in 2010 has been higher than it was the year before. Sargent estimated issuance so far this year to be close to $3 billion. This market is always going to be small, primarily because the leases that get financed are long and “there is not a lot of long money out there,” he said. The transactions have maturities of about 15 years or more.
Since the market is small, there is a glut of certain names, which widens the spreads for these credits. Walgreens and CVS are two retailers that have a lot of CTL paper in the market, sources agreed.
Despite challenges like market saturation faced by some names, sources concur that the CTL market will continue to grow in the near term. Despite its credit sensitivity, this market is a good option for investment-grade issuers, especially while the conduit markets are still shaky. The signs of life in the CMBS market are visible, “But it’s not going to be like the go-go days of 2006-2007,” Kalt said. Sphere: Related Content
CMBS' loss seems to be the credit tenant lease (CTL) market’s gain. The latter has shown robust growth in the face of the financial crisis and in its aftermath, mainly owing to the shutdown of the CMBS and conduit markets.
“The stars have been in alignment, and we did noticed that the CTL market was picking up steam in 2009,” said Michael Kalt, managing director and head of William Blair’s CTL group. The CTL market provides financing for investment-grade, single-tenant commercial real estate, where the loan is secured based on the underlying lease and the financed property.
These issuers, which normally would have turned to the CMBS and conduit markets, were left with limited options when the real estate bubble burst. The CTL market has also started to offer relatively attractive spreads and has become a more common form of funding than MBS, said Benjamin Harris, managing director and head of domestic investments at C.P. Carey.
Retail credit/tenants such as Walgreens, Home Depot, Lowes and CVS have participated in CTL deals. In June, alcoholic beverage company Diageo was involved in a $269 million deal, wherein a public REIT purchased a portfolio of vineyards from Diageo in a sale and leaseback and financed this with proceeds from a CTL transaction, Harris said. Federal, state and local governments, and not-for-profit health-care organizations have been getting more active in this market as well, Kalt added.
And the CTL market continues to flourish, because the other forms of financing it would normally compete against have yet to fully bounce back from the financial crisis. In addition to the CMBS market, banks and life insurance companies used to lend to these credit/tenants, but those forms of lending have yet to return to peak levels. Mortgage REITs also continue to suffer. Additionally, some specialty companies that were players in the CTL space have exited. GE Capital is one such example.
Holders of CTL paper also have some benefits over other securities, some say. “It is my argument that CTLs can be better than senior secured notes. Two years ago when liquidity evaporated it didn’t matter what you owned,” said Thomas Sargent, managing partner at Bostonia Global Securities. Furthermore, in the case of a bankruptcy, CTL paper often holds up better compared with senior unsecured notes, he added.
Kalt agreed, saying from an investor’s perspective a CTL investment allows for exposure to credit but still gives a secured interest in real estate. However, they also offer a lower debt service coverage ratios and from a liquidity perspective, CTL paper and plain vanilla private placements are about the same.
Furthermore, spreads on CTL deals are also attractive, sources agree. Yet, pricing one such transaction is not as simple as applying a constant spread over a comparable public bond issue, Kalt notes. In the CTL market, price boils down to industry, sector and credit, in addition to credit exposure on the buy side and the overall transaction structure. For instance, a healthcare 'AA' credit will be viewed differently from a government AA credit, or a corporate AA credit, he said. In the CTL market an NIAC-1 will not be price comparable across the spectrum of sectors.
Additionally, Harris said, pricing is driven by where the corporate bonds of a particular company are trading. These prices will also include an illiquidity premium of about 25 basis points or 50 basis points.
It is difficult to estimate the total volume of the CTL market because the deals are done through private placements, sources say. But they agree that issuance so far in 2010 has been higher than it was the year before. Sargent estimated issuance so far this year to be close to $3 billion. This market is always going to be small, primarily because the leases that get financed are long and “there is not a lot of long money out there,” he said. The transactions have maturities of about 15 years or more.
Since the market is small, there is a glut of certain names, which widens the spreads for these credits. Walgreens and CVS are two retailers that have a lot of CTL paper in the market, sources agreed.
Despite challenges like market saturation faced by some names, sources concur that the CTL market will continue to grow in the near term. Despite its credit sensitivity, this market is a good option for investment-grade issuers, especially while the conduit markets are still shaky. The signs of life in the CMBS market are visible, “But it’s not going to be like the go-go days of 2006-2007,” Kalt said. Sphere: Related Content
Tuesday, July 20, 2010
W.P. Carey Seeks $3 Billion in Sale-Leaseback Deals in Europe
Bloomberg BusinessWeek - July 16, 2010
W.P. Carey & Co., owner of the New York Times Co.’s headquarters, plans to spend about $3 billion buying European properties and leasing them back to the sellers as more businesses divest real estate to raise money.
The company, which specializes in sale-and-leaseback deals, has about $1.5 billion of cash to invest in the region during the next three to five years, H. Cabot Lodge, head of Europe, said in an interview at the company’s London offices. It plans to borrow a similar amount over that period to help finance acquisitions, he said.
European companies are increasingly turning to sale- leaseback arrangements to raise cash as bank lending remains restricted, according to broker CB Richard Ellis Group Inc. By selling their shops, offices or warehouses, companies can use the proceeds to expand and stay in the buildings as tenants.
“Capital is still tight,” said Lodge, 54. “A lot of chief executives who said they would never sell their real estate are now being pushed into it.”
Banco Bilbao Vizcaya Argentaria SA, Spain’s second-biggest bank, raised 1.15 billion euros ($1.5 billion) in September by selling 948 of its branches. HSBC Holdings Plc sold its headquarters in London’s Canary Wharf financial district for 1.09 billion pounds ($1.7 billion) in April 2007.
W.P. Carey’s funds already own about $3 billion of properties in Europe and about $7 billion in the U.S. There is far more potential for sale-and-leasebacks in Europe than there is in America, Lodge said. Two-thirds of European businesses own their properties, compared with a third of U.S. companies, according to W.P. Carey.
CB Richard Ellis is advising about three times as many European landlords about raising money from their real estate as it was a year ago, said John Wilson, the broker’s London-based head of corporate strategies.
“They’re effectively short of working capital to restructure themselves for the upturn,” Wilson said in a telephone interview.
The value of European sale-and-leasebacks surged to 46 billion euros in 2007 from 6.9 billion euros in 2004, according to CB Richard Ellis. Such deals have made up about 20 percent of European real estate transactions since 2007, Wilson said.
W.P. Carey purchased two warehouses from Eroski, a Spanish supermarket chain, for $52 million last month, according to its website. The company’s biggest European deal was in 2007, when it bought a real estate unit and some debt from Hellweg, a German home-improvement company, for 335 million euros.
In March 2009, W.P. Carey bought the space occupied by the New York Times in its Manhattan headquarters for $225 million and leased it back to the newspaper group for 15 years. Sphere: Related Content
W.P. Carey & Co., owner of the New York Times Co.’s headquarters, plans to spend about $3 billion buying European properties and leasing them back to the sellers as more businesses divest real estate to raise money.
The company, which specializes in sale-and-leaseback deals, has about $1.5 billion of cash to invest in the region during the next three to five years, H. Cabot Lodge, head of Europe, said in an interview at the company’s London offices. It plans to borrow a similar amount over that period to help finance acquisitions, he said.
European companies are increasingly turning to sale- leaseback arrangements to raise cash as bank lending remains restricted, according to broker CB Richard Ellis Group Inc. By selling their shops, offices or warehouses, companies can use the proceeds to expand and stay in the buildings as tenants.
“Capital is still tight,” said Lodge, 54. “A lot of chief executives who said they would never sell their real estate are now being pushed into it.”
Banco Bilbao Vizcaya Argentaria SA, Spain’s second-biggest bank, raised 1.15 billion euros ($1.5 billion) in September by selling 948 of its branches. HSBC Holdings Plc sold its headquarters in London’s Canary Wharf financial district for 1.09 billion pounds ($1.7 billion) in April 2007.
W.P. Carey’s funds already own about $3 billion of properties in Europe and about $7 billion in the U.S. There is far more potential for sale-and-leasebacks in Europe than there is in America, Lodge said. Two-thirds of European businesses own their properties, compared with a third of U.S. companies, according to W.P. Carey.
CB Richard Ellis is advising about three times as many European landlords about raising money from their real estate as it was a year ago, said John Wilson, the broker’s London-based head of corporate strategies.
“They’re effectively short of working capital to restructure themselves for the upturn,” Wilson said in a telephone interview.
The value of European sale-and-leasebacks surged to 46 billion euros in 2007 from 6.9 billion euros in 2004, according to CB Richard Ellis. Such deals have made up about 20 percent of European real estate transactions since 2007, Wilson said.
W.P. Carey purchased two warehouses from Eroski, a Spanish supermarket chain, for $52 million last month, according to its website. The company’s biggest European deal was in 2007, when it bought a real estate unit and some debt from Hellweg, a German home-improvement company, for 335 million euros.
In March 2009, W.P. Carey bought the space occupied by the New York Times in its Manhattan headquarters for $225 million and leased it back to the newspaper group for 15 years. Sphere: Related Content
Mitchells & Butlers Agrees to £91 Million Sale Leaseback of 52 Budget Hotels in the UK
Morning Advertiser - July 15, 2010
Mitchells & Butlers, Britain's biggest managed pub group, has announced the sale of 52 budget hotels for £91m.
The deal, to Prupim includes the sale-and-leaseback of eight pubs that are inseparable from the adjacent accomodation properties, which are all branded as Innkeeper's Lodges.
Travelodge is expected to sign 25-year leases on the lodges from PRUPIM, a property investor, adding to 2,000 rooms to its business.
M&B has exchanged contracts with Prupim on 44 properties so far, with heads of terms in place for the remaining eight sites.
The 52 lodges generated earnings before interest and tax (EBIT) of £9.5m, equating to an EBIT multiple of 7.9 times. The value attached to the pubs that M&B is leasing back is £16m.
The sale of the lodges at £75m comes against a book value of £93m.
The eight pubs have been sold at an initial yield of 6.0%, meaning that M&B will pay annual rents totalling £960,000 — or £120,000 per pub.
The transactions with Travelodge and PRUPIM are expected to complete on 10 August 2010.
Adam Fowle, M&B's chief executive, said: "This transaction is in line with our strategy of disposing of the non-core assets and focusing the business on expanding the number of sites of our market leading restaurant and pub brands, which have significant growth potential." Sphere: Related Content
Mitchells & Butlers, Britain's biggest managed pub group, has announced the sale of 52 budget hotels for £91m.
The deal, to Prupim includes the sale-and-leaseback of eight pubs that are inseparable from the adjacent accomodation properties, which are all branded as Innkeeper's Lodges.
Travelodge is expected to sign 25-year leases on the lodges from PRUPIM, a property investor, adding to 2,000 rooms to its business.
M&B has exchanged contracts with Prupim on 44 properties so far, with heads of terms in place for the remaining eight sites.
The 52 lodges generated earnings before interest and tax (EBIT) of £9.5m, equating to an EBIT multiple of 7.9 times. The value attached to the pubs that M&B is leasing back is £16m.
The sale of the lodges at £75m comes against a book value of £93m.
The eight pubs have been sold at an initial yield of 6.0%, meaning that M&B will pay annual rents totalling £960,000 — or £120,000 per pub.
The transactions with Travelodge and PRUPIM are expected to complete on 10 August 2010.
Adam Fowle, M&B's chief executive, said: "This transaction is in line with our strategy of disposing of the non-core assets and focusing the business on expanding the number of sites of our market leading restaurant and pub brands, which have significant growth potential." Sphere: Related Content
NNSA Closes $687 Lease Financing of Manufacturing Facility in Kansas City
citybizlist.com - July 15, 2010
CGA Capital Corp. and affiliates have closed a $687 million structured lease-back financing that opens the door for the construction of a 1.5 million-square-foot manufacturing facility to serve as the National Security Campus for the National Nuclear Security Administration (NNSA). The $4.76 billion campus will be developed in Kansas City, Mo.
Baltimore-based CGA Capital was assisted by a team of attorneys from Ballard Spahr LLP, serving as exclusive financial adviser and structuring agent for the complex public-private venture, and was the sole arranger of the private placement of bonds through a venture with a privately held securities firm. CGA's efforts covered every aspect of devising and structuring the financing needed for the project, which will break ground in August.
The CGA team was led by managing directors and principals W. Kyle Gore and Richard A. Jacobs, and included Duncan Swanston and various principals at Bostonia Global Securities LLC. The Ballard Spahr team was led by Fred Wolf III and included Thomas A. Hauser, Charles R. Moran, Alan S. Ritterband, Benjamin A. Kelley, Michael T. Kersten, and Anna Mahaney.
The five-building campus will be the primary producer of nonnuclear mechanical, electronic, and engineered materials for the U.S. nuclear weapons arsenal and other national security missions. The transaction is secured with a 20-year credit-tenant lease with the U.S. General Services Administration. The near $5 billion cost includes design, construction, equipment and the lease. CenterPoint Zimmer LLC, an affiliate of Chicago-based CenterPoint Properties Trust, is the developer of the campus.
The NNSA currently operates in a World War II-era plant in Kansas City. The new campus, which will include a research facility, represents one of the largest commercial projects in the U.S.
The development site is a farm near the existing NNSA facilty. The acreage is owned by the Planned Industrial Expansion Authority of Kansas City. NNSA's operations at the project will be managed by Honeywell Federal Manufacturing & Technologies LLC, which operates the current facility.
The campus is slated for completion in 2014. It is one of the largest public-private GSA projects in its history, with estimates that 2,500 jobs will be created with the completion. Sphere: Related Content
CGA Capital Corp. and affiliates have closed a $687 million structured lease-back financing that opens the door for the construction of a 1.5 million-square-foot manufacturing facility to serve as the National Security Campus for the National Nuclear Security Administration (NNSA). The $4.76 billion campus will be developed in Kansas City, Mo.
Baltimore-based CGA Capital was assisted by a team of attorneys from Ballard Spahr LLP, serving as exclusive financial adviser and structuring agent for the complex public-private venture, and was the sole arranger of the private placement of bonds through a venture with a privately held securities firm. CGA's efforts covered every aspect of devising and structuring the financing needed for the project, which will break ground in August.
The CGA team was led by managing directors and principals W. Kyle Gore and Richard A. Jacobs, and included Duncan Swanston and various principals at Bostonia Global Securities LLC. The Ballard Spahr team was led by Fred Wolf III and included Thomas A. Hauser, Charles R. Moran, Alan S. Ritterband, Benjamin A. Kelley, Michael T. Kersten, and Anna Mahaney.
The five-building campus will be the primary producer of nonnuclear mechanical, electronic, and engineered materials for the U.S. nuclear weapons arsenal and other national security missions. The transaction is secured with a 20-year credit-tenant lease with the U.S. General Services Administration. The near $5 billion cost includes design, construction, equipment and the lease. CenterPoint Zimmer LLC, an affiliate of Chicago-based CenterPoint Properties Trust, is the developer of the campus.
The NNSA currently operates in a World War II-era plant in Kansas City. The new campus, which will include a research facility, represents one of the largest commercial projects in the U.S.
The development site is a farm near the existing NNSA facilty. The acreage is owned by the Planned Industrial Expansion Authority of Kansas City. NNSA's operations at the project will be managed by Honeywell Federal Manufacturing & Technologies LLC, which operates the current facility.
The campus is slated for completion in 2014. It is one of the largest public-private GSA projects in its history, with estimates that 2,500 jobs will be created with the completion. Sphere: Related Content
Kesko Agrees to EUR 107.5 Million Sale Leaseback of Ten Properties
Kesko Website - July 1, 2010
Kesko has today made an agreement on the sale of ten properties with Ilmarinen Mutual Pension Insurance Company and Kruunuvuoren Satama Oy, a joint venture established by Ilmarinen, the Kesko Pension Fund and Kesko Corporation. The debt-free selling price of the properties totalled €107.5 million and Kesko will recognise the total gain of €47.4 million on their sale. In the same connection, the Kesko Pension Fund sold seven retail store properties owned by it to Kruunuvuoren Satama Oy.
According to the agreements made today, Kesko sold eight retail store properties used by the Kesko Group to Kruunuvuoren Satama Oy. In addition, Kesko sold two other properties to Ilmarinen today. The €47.4 million gain on the sale of the properties will be treated as a non-recurring item in Kesko's operating profit for the third quarter of the year, with the exception of a non-recurring €2.3 million gain on the sale, which will be recognised for the fourth quarter.
Kesko Group companies leased the properties sold by Kesko to the joint venture and Ilmarinen for the Kesko Group companies' use mainly on 15-year leases with extension options. Kesko Group's lease liabilities for the real estate covered by these leases amount to some €63 million. At the same time, Kesko Group companies also leased from Kruunuvuoren Satama Oy the retail store properties it had bought from the Kesko Pension Fund under similar terms. The total lease liabilities of the Kesko Group on properties used by it increase by some €120 million. Lease liabilities are not classified as finance leases.
A separate stock exchange release has been published today on the establishment of the joint venture, Kruunuvuoren Satama Oy. Sphere: Related Content
Kesko has today made an agreement on the sale of ten properties with Ilmarinen Mutual Pension Insurance Company and Kruunuvuoren Satama Oy, a joint venture established by Ilmarinen, the Kesko Pension Fund and Kesko Corporation. The debt-free selling price of the properties totalled €107.5 million and Kesko will recognise the total gain of €47.4 million on their sale. In the same connection, the Kesko Pension Fund sold seven retail store properties owned by it to Kruunuvuoren Satama Oy.
According to the agreements made today, Kesko sold eight retail store properties used by the Kesko Group to Kruunuvuoren Satama Oy. In addition, Kesko sold two other properties to Ilmarinen today. The €47.4 million gain on the sale of the properties will be treated as a non-recurring item in Kesko's operating profit for the third quarter of the year, with the exception of a non-recurring €2.3 million gain on the sale, which will be recognised for the fourth quarter.
Kesko Group companies leased the properties sold by Kesko to the joint venture and Ilmarinen for the Kesko Group companies' use mainly on 15-year leases with extension options. Kesko Group's lease liabilities for the real estate covered by these leases amount to some €63 million. At the same time, Kesko Group companies also leased from Kruunuvuoren Satama Oy the retail store properties it had bought from the Kesko Pension Fund under similar terms. The total lease liabilities of the Kesko Group on properties used by it increase by some €120 million. Lease liabilities are not classified as finance leases.
A separate stock exchange release has been published today on the establishment of the joint venture, Kruunuvuoren Satama Oy. Sphere: Related Content
Tuesday, July 13, 2010
Stag Capital & GI Partners Form $200 Million Net Lease Investment JV
The Business Journal of the Greater Triad Area - July 12, 2010
Stag Capital Partners and GI Partners said Monday they plan to invest up to $200 million to acquire individual single-tenant net leased industrial properties throughout the United States.
Menlo Park-based GI concentrates on investments in asset-intensive middle-market businesses and properties in North America and Western Europe.
Boston-based Stag said the new venture will continue strategy to acquire and manage assets predominately located in secondary markets with purchase prices ranging from $5 million to $20 million.
Property types sought include warehouse, flex, and manufacturing buildings. STAG has used more than $1.2 billion of capital to acquire more than 200 properties since 2003.
GI Partners said it will invest in the venture through GI Partners Fund III L.P., which has $1.9 billion of capital commitments from leading institutional private equity and real estate investors. Sphere: Related Content
Stag Capital Partners and GI Partners said Monday they plan to invest up to $200 million to acquire individual single-tenant net leased industrial properties throughout the United States.
Menlo Park-based GI concentrates on investments in asset-intensive middle-market businesses and properties in North America and Western Europe.
Boston-based Stag said the new venture will continue strategy to acquire and manage assets predominately located in secondary markets with purchase prices ranging from $5 million to $20 million.
Property types sought include warehouse, flex, and manufacturing buildings. STAG has used more than $1.2 billion of capital to acquire more than 200 properties since 2003.
GI Partners said it will invest in the venture through GI Partners Fund III L.P., which has $1.9 billion of capital commitments from leading institutional private equity and real estate investors. Sphere: Related Content
Monday, July 12, 2010
Qantas Agrees to $169 Million Sale Leaseback of Global HQ in Sydney
The Australian - July 13, 2010
The Brisbane-based REIT has agreed to pay $143m for the 50,000 sq m building and an extra $26m to fund an office fit-out in a trade-off for a 10-year Qantas office leaseback.
The purchase, less than a week after the $600m Cromwell Group dropped out of the bidding for Melbourne's troubled Orchard Funds Management business, involves both the freehold and leasehold of the Mascot complex.
Qantas owns the freehold of the 203 Coward Street property while the leasehold -- bought by an Allco syndicate for around $150m a decade ago -- is controlled by the Trafalgar-managed Sydney Airport Centre Joint Venture.
Cromwell, which yesterday announced a placement and rights issue to raise up to $120m, will use $85m from the capital raising and an $84m debt facility to fund the Qantas acquisition. Its equity raising involves an institutional placement to raise between $52m and $80m at 75c, with the balance coming from a 72c rights issue. Sphere: Related Content
The Brisbane-based REIT has agreed to pay $143m for the 50,000 sq m building and an extra $26m to fund an office fit-out in a trade-off for a 10-year Qantas office leaseback.
The purchase, less than a week after the $600m Cromwell Group dropped out of the bidding for Melbourne's troubled Orchard Funds Management business, involves both the freehold and leasehold of the Mascot complex.
Qantas owns the freehold of the 203 Coward Street property while the leasehold -- bought by an Allco syndicate for around $150m a decade ago -- is controlled by the Trafalgar-managed Sydney Airport Centre Joint Venture.
Cromwell, which yesterday announced a placement and rights issue to raise up to $120m, will use $85m from the capital raising and an $84m debt facility to fund the Qantas acquisition. Its equity raising involves an institutional placement to raise between $52m and $80m at 75c, with the balance coming from a 72c rights issue. Sphere: Related Content
Thursday, July 08, 2010
AIB Agrees to EUR 28 Million Sale Leaseback of Bank Branch in Dublin
The Irish Times - July 7, 2010
The German fund manager GLL Real Estate has emerged as the new owner of the AIB bank branch on Grafton Street, Dublin 2, which is to be leased back to the bank for a period of 20 years. The investment, costing almost €28 million, will show a net yield of 6 per cent.
GLL’s first incursion into the Irish market will be welcomed by the investment sector where activity has been at a virtual standstill for two years because of the banking crisis and the collapse in property values. There have been relatively few overseas buyers in the Dublin market over the years because of the widely held perception that investment properties were for a long time seriously overvalued.
That view has changed with the recent fall in values by up to 50 per cent. GLL’s high profile in the European and US property markets is expected to trigger further European interest in the Dublin market once the sale of a range of distressed property investments gets under way later this year.
Colm Luddy of CB Richard Ellis, who handled the sale for AIB, said yesterday that the dramatic fall in prices may well be at an end as illustrated by the 6 per cent yield in this case.
Earlier this year, Boodles store on Grafton Street was sold at a yield of 6.35 per cent and a year earlier another German fund, DekaBank, settled for a return of 6.4 per cent when buying the Tommy Hilfiger store.
Luddy said the higher yields were atttacting a lot of international interest but “deal flow” was proving slow. He expected more assets to come on the market as capital would be required to complete developments going into Nama.
John Moran, managing director of Jones Lang LaSalle, said that with the bedding down of the Nama process, they were starting to notice a loosening up in the investment market.
While this had not translated into significant transactional activity yet, there was sufficient evidence around to support a view that liquidity levels should improve from September onwards. It was particularly noticeable that there were a number of new foreign entities that were trying to acquire trophy assets or, alternatively, looking to take advantage of some distressed situations.
Jonathan Hillier of Dublin agency HWBC advised GLL Real Estate. Sphere: Related Content
The German fund manager GLL Real Estate has emerged as the new owner of the AIB bank branch on Grafton Street, Dublin 2, which is to be leased back to the bank for a period of 20 years. The investment, costing almost €28 million, will show a net yield of 6 per cent.
GLL’s first incursion into the Irish market will be welcomed by the investment sector where activity has been at a virtual standstill for two years because of the banking crisis and the collapse in property values. There have been relatively few overseas buyers in the Dublin market over the years because of the widely held perception that investment properties were for a long time seriously overvalued.
That view has changed with the recent fall in values by up to 50 per cent. GLL’s high profile in the European and US property markets is expected to trigger further European interest in the Dublin market once the sale of a range of distressed property investments gets under way later this year.
Colm Luddy of CB Richard Ellis, who handled the sale for AIB, said yesterday that the dramatic fall in prices may well be at an end as illustrated by the 6 per cent yield in this case.
Earlier this year, Boodles store on Grafton Street was sold at a yield of 6.35 per cent and a year earlier another German fund, DekaBank, settled for a return of 6.4 per cent when buying the Tommy Hilfiger store.
Luddy said the higher yields were atttacting a lot of international interest but “deal flow” was proving slow. He expected more assets to come on the market as capital would be required to complete developments going into Nama.
John Moran, managing director of Jones Lang LaSalle, said that with the bedding down of the Nama process, they were starting to notice a loosening up in the investment market.
While this had not translated into significant transactional activity yet, there was sufficient evidence around to support a view that liquidity levels should improve from September onwards. It was particularly noticeable that there were a number of new foreign entities that were trying to acquire trophy assets or, alternatively, looking to take advantage of some distressed situations.
Jonathan Hillier of Dublin agency HWBC advised GLL Real Estate. Sphere: Related Content
Tuesday, July 06, 2010
DuGan Departs WP Carey
Wall Street Journal - July 6, 2010
Real-estate investment firm W.P. Carey & Co. LLC (WPC) said Chief Executive Gordon DuGan has resigned after clashing with Chairman Wm. Polk Carey about the direction of the company and Carey's "authority and control" of it.
Board member Trevor Bond was named interim CEO while the company also announced the acting tag was taken off of Chief Financial Officer Mark DeCesaris after nearly five years. Since November 2005, he was acting CFO as well as chief administrative officer.
The changes come as W.P. Carey has seen generally lower results in recent quarters as some investors in the real-estate space are looking to take advantage of a perceived undervaluation of some assets in the wake of tumbling property prices. The company provides long-term sale- leaseback and build-to-suit financing for companies worldwide and manages a global investment portfolio approaching $10 billion.
"Though Gordon and I have not been strategically aligned in the recent years, I remain an admirer of his abundant investment management and general business talent," said Carey.
DuGan added, "I am gratified that I leave the company as it is performing well and in a solid financial position. I wish the company well in the future." He became co-CEO in 2002 after joining the company in 1988 as an assistant to Carey and became ole CEO in 2005.
Bond joined W.P. Carey's board in 2007 and has spent a quarter-century in the real-estate business, including stints at Maidstone Investment Co. LLC, Credit Suisse Group (CS) and Goldman Sachs Group Inc. (GS). Sphere: Related Content
Real-estate investment firm W.P. Carey & Co. LLC (WPC) said Chief Executive Gordon DuGan has resigned after clashing with Chairman Wm. Polk Carey about the direction of the company and Carey's "authority and control" of it.
Board member Trevor Bond was named interim CEO while the company also announced the acting tag was taken off of Chief Financial Officer Mark DeCesaris after nearly five years. Since November 2005, he was acting CFO as well as chief administrative officer.
The changes come as W.P. Carey has seen generally lower results in recent quarters as some investors in the real-estate space are looking to take advantage of a perceived undervaluation of some assets in the wake of tumbling property prices. The company provides long-term sale- leaseback and build-to-suit financing for companies worldwide and manages a global investment portfolio approaching $10 billion.
"Though Gordon and I have not been strategically aligned in the recent years, I remain an admirer of his abundant investment management and general business talent," said Carey.
DuGan added, "I am gratified that I leave the company as it is performing well and in a solid financial position. I wish the company well in the future." He became co-CEO in 2002 after joining the company in 1988 as an assistant to Carey and became ole CEO in 2005.
Bond joined W.P. Carey's board in 2007 and has spent a quarter-century in the real-estate business, including stints at Maidstone Investment Co. LLC, Credit Suisse Group (CS) and Goldman Sachs Group Inc. (GS). Sphere: Related Content
Friday, July 02, 2010
Land Securities London HQ Listed for Sale
Mellersh & Harding Website - June 25, 2010
A London commercial property has been placed on the market by a private investor just months after it was purchased in a bid to capitalise on the improving conditions.
Number 5 Strand, close to Trafalgar Square, bought last summer for £44 million, is up for sale for £53 million, according to Property Week, which states the vendor is 'flipping' it.
The building is fully let to Land Securities, which is using it as its headquarters, as well as Boots, which recently signed a new lease for a current retail outlet.
Foreign investors have been moving in on the capital in recent months thanks to the exchange rate and potential returns promised by the West End office and City of London prime assets. Sphere: Related Content
A London commercial property has been placed on the market by a private investor just months after it was purchased in a bid to capitalise on the improving conditions.
Number 5 Strand, close to Trafalgar Square, bought last summer for £44 million, is up for sale for £53 million, according to Property Week, which states the vendor is 'flipping' it.
The building is fully let to Land Securities, which is using it as its headquarters, as well as Boots, which recently signed a new lease for a current retail outlet.
Foreign investors have been moving in on the capital in recent months thanks to the exchange rate and potential returns promised by the West End office and City of London prime assets. Sphere: Related Content
Macy's Ponders Sale Leaseback of Landmark Store in Pittsburgh
Pittsburgh Post-Gazette - July 1, 2010
The Macy's building, the Downtown landmark that has hosted generations of shoppers and numerous meetings under its famous clock, is up for sale.
But the store itself isn't going anywhere.
Jim Sluzewski, Macy's spokesman, confirmed Wednesday that the retailer has put the 13-story building at the intersection of Fifth Avenue and Smithfield Street on the market.
"Right now, we're exploring and seeing what interest there might be," he said.
The building, which for decades housed the Kaufmann's department store, joins the growing number of Downtown properties on the sales block, including the Gateway Center complex, the Henry W. Oliver Building and the Regional Enterprise Tower, formerly known as the Alcoa Building.
Even with a sale, Macy's department store would remain inside the building under a lease-back arrangement, Mr. Sluzewski said. The structure also would continue to house the retailer's Midwest region headquarters and district offices. "Our intention is to keep both there," he said.
However, he added that depending on the needs of the buyer, Macy's could end up consolidating the store's retail space within the building. Mr. Sluzewski said the building has about three times the amount of retail space of a typical suburban store. Macy's uses 10 floors for retail sales and part of the 11th for office space. The two highest floors are vacant.
"The store currently has probably more space than current traffic patterns require," he said. "We could reduce the number of floors the store is on. It all depends on what the need is and the interest is."
Mr. Sluzewski said a sale would have no impact on traditions like the department store's Christmas window display.
Macy's gained control of the building in the 2005 acquisition of May Department Stores, the former Kaufmann's owner. May paid $2.8 million for the real estate in 1986, according to the Allegheny County website. The property currently is assessed at $14 million.
In putting the building on the market, Mr. Sluzewski said, Macy's is seeking to capitalize on the redevelopment and stable real estate market Downtown.
"It really is a function of the tremendous energy and activity in Downtown Pittsburgh," he said. "We thought this would be a good time to see what expressions of interest there are."
Macy's is interested in one of two alternatives: Selling the building outright and leasing back portions of it or finding a tenant with an interest in leasing space while Macy's would maintain ownership.
The building has a long and rich history Downtown dating to the latter 1800s when the Kaufmann family opened a store at Smithfield and Diamond Alley (now Forbes Avenue). The store expanded rapidly, eventually occupying Smithfield between Forbes and Fifth. By 1913, the building in its current form existed.
Herky Pollock, an executive vice president for real estate brokerage CB Richard Ellis/Pittsburgh, said he sees the sale of the building as a way for Macy's to put its money to better use in operations or merchandising rather than having it tied up in real estate.
"It would also give them the opportunity at some point to downsize as they currently do not utilize their full building," he said.
Mr. Pollock sees potential interest in the building from local investors and developers as well as national public or private real estate investment trusts. He estimated the worth of the building at $25 to $30 a square foot, which would put a sale at $30 million to $35 million.
Mr. Sluzewski said no asking price for the building has been set. The Pittsburgh building, he said, is the only one Macy's is putting up for sale right now.
Tom Sullivan, a commercial broker for Pennsylvania Commercial Real Estate, said a possible sale of the building had been rumored for a while. He thinks Macy's is trying to cut operating costs.
"They use way too much space in the building. The operation costs have to be a killer. I would guess the building operates at a loss," he said.
While Mr. Pollock sees the numerous buildings for sale Downtown as the sign of a robust real estate market, Mr. Sullivan has a different view. He believes the owners see occupancy and lease rates declining in the future because of a prolonged recession and are trying to capitalize while they can.
"These people are getting out while the getting's good, in my opinion," he said. Sphere: Related Content
The Macy's building, the Downtown landmark that has hosted generations of shoppers and numerous meetings under its famous clock, is up for sale.
But the store itself isn't going anywhere.
Jim Sluzewski, Macy's spokesman, confirmed Wednesday that the retailer has put the 13-story building at the intersection of Fifth Avenue and Smithfield Street on the market.
"Right now, we're exploring and seeing what interest there might be," he said.
The building, which for decades housed the Kaufmann's department store, joins the growing number of Downtown properties on the sales block, including the Gateway Center complex, the Henry W. Oliver Building and the Regional Enterprise Tower, formerly known as the Alcoa Building.
Even with a sale, Macy's department store would remain inside the building under a lease-back arrangement, Mr. Sluzewski said. The structure also would continue to house the retailer's Midwest region headquarters and district offices. "Our intention is to keep both there," he said.
However, he added that depending on the needs of the buyer, Macy's could end up consolidating the store's retail space within the building. Mr. Sluzewski said the building has about three times the amount of retail space of a typical suburban store. Macy's uses 10 floors for retail sales and part of the 11th for office space. The two highest floors are vacant.
"The store currently has probably more space than current traffic patterns require," he said. "We could reduce the number of floors the store is on. It all depends on what the need is and the interest is."
Mr. Sluzewski said a sale would have no impact on traditions like the department store's Christmas window display.
Macy's gained control of the building in the 2005 acquisition of May Department Stores, the former Kaufmann's owner. May paid $2.8 million for the real estate in 1986, according to the Allegheny County website. The property currently is assessed at $14 million.
In putting the building on the market, Mr. Sluzewski said, Macy's is seeking to capitalize on the redevelopment and stable real estate market Downtown.
"It really is a function of the tremendous energy and activity in Downtown Pittsburgh," he said. "We thought this would be a good time to see what expressions of interest there are."
Macy's is interested in one of two alternatives: Selling the building outright and leasing back portions of it or finding a tenant with an interest in leasing space while Macy's would maintain ownership.
The building has a long and rich history Downtown dating to the latter 1800s when the Kaufmann family opened a store at Smithfield and Diamond Alley (now Forbes Avenue). The store expanded rapidly, eventually occupying Smithfield between Forbes and Fifth. By 1913, the building in its current form existed.
Herky Pollock, an executive vice president for real estate brokerage CB Richard Ellis/Pittsburgh, said he sees the sale of the building as a way for Macy's to put its money to better use in operations or merchandising rather than having it tied up in real estate.
"It would also give them the opportunity at some point to downsize as they currently do not utilize their full building," he said.
Mr. Pollock sees potential interest in the building from local investors and developers as well as national public or private real estate investment trusts. He estimated the worth of the building at $25 to $30 a square foot, which would put a sale at $30 million to $35 million.
Mr. Sluzewski said no asking price for the building has been set. The Pittsburgh building, he said, is the only one Macy's is putting up for sale right now.
Tom Sullivan, a commercial broker for Pennsylvania Commercial Real Estate, said a possible sale of the building had been rumored for a while. He thinks Macy's is trying to cut operating costs.
"They use way too much space in the building. The operation costs have to be a killer. I would guess the building operates at a loss," he said.
While Mr. Pollock sees the numerous buildings for sale Downtown as the sign of a robust real estate market, Mr. Sullivan has a different view. He believes the owners see occupancy and lease rates declining in the future because of a prolonged recession and are trying to capitalize while they can.
"These people are getting out while the getting's good, in my opinion," he said. Sphere: Related Content
Goldman Sachs London HQ Listed for Sale
Irish Independent - June 11, 2010
Several prominent businessmen are set to get a cash injection following news that the consortium that bought the Goldman Sachs headquarters in London for €370m 10 years ago have put the building up for sale again.
The consortium is believed to be looking to recoup the amount they paid for the Fleet Street building when they bought it in 2000 in a landmark deal which heralded the arrival of the Irish as a force in the London property market.
The former 'Daily Express' building was bought by Green Property and a group of Irish investors put together by Kevin Warren.
Those who backed the original investment through the Isle of Man-based River Court include beef baron Larry Goodman, former DCC boss Jim Flavin, Kingspan founder Eugene Murtagh, Fexco's Brian McCarthy, former 'Kilkenny People' owner John Kerry Keane, Galway businessman Donogh O'Donoghue and builder Sean McKeon. Sphere: Related Content
Several prominent businessmen are set to get a cash injection following news that the consortium that bought the Goldman Sachs headquarters in London for €370m 10 years ago have put the building up for sale again.
The consortium is believed to be looking to recoup the amount they paid for the Fleet Street building when they bought it in 2000 in a landmark deal which heralded the arrival of the Irish as a force in the London property market.
The former 'Daily Express' building was bought by Green Property and a group of Irish investors put together by Kevin Warren.
Those who backed the original investment through the Isle of Man-based River Court include beef baron Larry Goodman, former DCC boss Jim Flavin, Kingspan founder Eugene Murtagh, Fexco's Brian McCarthy, former 'Kilkenny People' owner John Kerry Keane, Galway businessman Donogh O'Donoghue and builder Sean McKeon. Sphere: Related Content
Thursday, July 01, 2010
Altarea Cogedim Enters $140 Million Sale Leaseback of Paris Hotel
Reuters - July 1, 2010
Germany's Deka open-ended mutual property fund said on Thursday it has acquired a hotel in Paris for 114 million euros ($140 million) in a sale-and-leaseback agreement with French developer Altarea Cogedim (IMAF.PA).
The 118-room Hotel Renaissance Arc de Triomphe, near the Paris landmark, will be leased long term to Altarea, and managed by hotels operator Marriott International (MAR.N), Deka said in a statement.
Deka's parent, DekaBank, Germany's largest manager of open-ended property funds, said last month it plans 2 billion euros worth of property buys globally this year, focused on safer, more liquid markets. Sphere: Related Content
Germany's Deka open-ended mutual property fund said on Thursday it has acquired a hotel in Paris for 114 million euros ($140 million) in a sale-and-leaseback agreement with French developer Altarea Cogedim (IMAF.PA).
The 118-room Hotel Renaissance Arc de Triomphe, near the Paris landmark, will be leased long term to Altarea, and managed by hotels operator Marriott International (MAR.N), Deka said in a statement.
Deka's parent, DekaBank, Germany's largest manager of open-ended property funds, said last month it plans 2 billion euros worth of property buys globally this year, focused on safer, more liquid markets. Sphere: Related Content
Wednesday, June 30, 2010
Tesco Nearing $1.4 Billion Sale Leaseback of 41 Supermarkets Across UK
Reuters - June 29, 2010
Supermarket group Tesco Plc (TSCO.L) plans to sell a 30-year benchmark sterling bond backed by rents generated by a portfolio of its supermarkets, an official at one of the banks managing the deal said on Tuesday.
HSBC and Goldman Sachs are managing the (30-year) sale and leaseback deal, which will be issued via Tesco Property Finance 3, the official said.
News of the proposed deal comes less than a year after the blue chip retailer tapped 565 million pounds from the sale of a similar batch of property-backed bonds in September.
That sale followed a similar deal in June 2009, which raised 431 million pounds.
Moody's Investors Service assigned a provisional A3 rating to the bonds, which it expects to total 950.15 million pounds, although the official said the final size had yet to be determined.
The bonds are due to mature in April 2040 and would be supported by a portfolio of 41 supermarkets across the UK, Moody's said.
The proposed issue would have a slightly lower total leverage based on the expected issuance amount compared with its previous deals, it added.
"In addition, in this transaction, the tenant has an option to terminate the occupational leases in September 2020 subject to certain conditions in the lease agreements being fulfilled," said Moody's.
Standard & Poor's and Fitch are expected to rate the bond at A-, the official said.
Moody's has estimated the market value of the portfolio at 853.1 million pounds, taking into account the break option of the leases in September 2020.
(NOTE: Sources indicate the 10-year lease break clause is all or none, the initial unlevered yield on the sale leaseback is 5.0%, and the 30-year fully-amortizing bonds sold for around 170 basis points over 30-year gilts (+/- 4.20% + 1.70% = 5.90%.) Sphere: Related Content
Supermarket group Tesco Plc (TSCO.L) plans to sell a 30-year benchmark sterling bond backed by rents generated by a portfolio of its supermarkets, an official at one of the banks managing the deal said on Tuesday.
HSBC and Goldman Sachs are managing the (30-year) sale and leaseback deal, which will be issued via Tesco Property Finance 3, the official said.
News of the proposed deal comes less than a year after the blue chip retailer tapped 565 million pounds from the sale of a similar batch of property-backed bonds in September.
That sale followed a similar deal in June 2009, which raised 431 million pounds.
Moody's Investors Service assigned a provisional A3 rating to the bonds, which it expects to total 950.15 million pounds, although the official said the final size had yet to be determined.
The bonds are due to mature in April 2040 and would be supported by a portfolio of 41 supermarkets across the UK, Moody's said.
The proposed issue would have a slightly lower total leverage based on the expected issuance amount compared with its previous deals, it added.
"In addition, in this transaction, the tenant has an option to terminate the occupational leases in September 2020 subject to certain conditions in the lease agreements being fulfilled," said Moody's.
Standard & Poor's and Fitch are expected to rate the bond at A-, the official said.
Moody's has estimated the market value of the portfolio at 853.1 million pounds, taking into account the break option of the leases in September 2020.
(NOTE: Sources indicate the 10-year lease break clause is all or none, the initial unlevered yield on the sale leaseback is 5.0%, and the 30-year fully-amortizing bonds sold for around 170 basis points over 30-year gilts (+/- 4.20% + 1.70% = 5.90%.) Sphere: Related Content
Saturday, June 26, 2010
Diagio Completes $269 Million Sale Leaseback of Napa Valley Wineries
The Press Democrat - June 24, 2010
One of the largest California wine deals in years was announced Thursday, not that wine drinkers will ever taste the difference.
Diageo, the London-based alcohol conglomerate, revealed that it is selling most of its Napa Valley wineries and vineyards to an investment firm for $269 million, and then turning around and leasing them back for 20 years.
The sale-leaseback arrangement between Diageo and Realty Income Corp., an Escondido-based real estate investment trust, is the largest such transaction in the U.S. wine business, one that will help Diageo raise cash without impacting its wine operations, said industry analyst Robert Nicholson.
“It's a very meaningful development and it's a very smart move by Diageo,” said Nicholson, a principal at International Wine Associates, a Healdsburg consulting firm
The deal involves two of the best known Napa wineries. The historic Beaulieu Vineyards was founded in 1900 in Rutherford and, under the guidance of the famed viticulturalist André Tchelistcheff, helped spawn the valley's fine-wine renaissance.
Sterling Vineyards, the white stucco winery on a bluff south of Calistoga, was founded in 1964 by British international paper broker Peter Newton and has become one of Napa Valley's most popular tourist destinations.
Diageo Chateau & Estate Wines will continue to manage and operate the properties and will retain ownership and marketing of the wine brands. In return, it will enter into 20-leases for the buildings and 2,000 acres of vineyards. When completed, Diageo will become Realty Income's second-biggest tenant.
The transaction allows Diageo, which has struggled during the recession, to raise cash and increase returns for shareholders.
“We know that to remain competitive in this environment we need to rethink our whole wine business to be more nimble and entrepreneurial,” said Zsoka McDonald, a company spokeswoman. “This is about ensuring the long-term strength of our North America wine business and the health of our core wine brands.”
Diageo's wine and spirits portfolios tend toward the high-end, and it has been hit hard as the alcohol business has proven to be less recession-proof than many thought. It owns such powerhouse brands as Johnnie Walker whiskey, Smirnoff vodka and Guinness stout.
Its wine sales fell 7 percent in 2009. The company announced in May it was restructuring U.S. wine operations, laying off about 14 percent of its workforce and would focus on core wine brands, including Beaulieu Vineyard, Sterling Vineyards, Chalone, Acacia, Rosenblum Cellars and Provenance.
The chief benefit for Diageo is that is can raise cash while paying reasonable leases on the properties, said Joe Ciatti, of Zepponi & Company of Santa Rosa.
“Diageo's saying ‘We've got these wine assets that really don't produce a lot of return for us, and it's better for us to sell those off,' ” Ciatti said.
He said he understood the leases would generate a 6 percent return for Realty Income Corp., a conservative return, he said.
Ciatti ran his own wine industry focused REIT, Vintage Wine Trust, from 2005 to 2008, when he was forced to liquidate it because the returns weren't what investors had hoped.
VinREIT in St. Helena is facing challenges, as well, with several of its properties facing foreclosure.
Nicholson, however, said this deal should work well for Realty Income Corp because it got great properties with a tenant that isn't going anywhere.
“This REIT is smart. They know what they are doing and got some blue-chip assets,” he said.
And wine consumers, whether visiting the Napa tasting rooms or buying the wines in supermarkets, won't notice a difference, Nicholson said.
“This is the same as the way Marriott doesn't own their hotels,” Nicholson said. Sphere: Related Content
One of the largest California wine deals in years was announced Thursday, not that wine drinkers will ever taste the difference.
Diageo, the London-based alcohol conglomerate, revealed that it is selling most of its Napa Valley wineries and vineyards to an investment firm for $269 million, and then turning around and leasing them back for 20 years.
The sale-leaseback arrangement between Diageo and Realty Income Corp., an Escondido-based real estate investment trust, is the largest such transaction in the U.S. wine business, one that will help Diageo raise cash without impacting its wine operations, said industry analyst Robert Nicholson.
“It's a very meaningful development and it's a very smart move by Diageo,” said Nicholson, a principal at International Wine Associates, a Healdsburg consulting firm
The deal involves two of the best known Napa wineries. The historic Beaulieu Vineyards was founded in 1900 in Rutherford and, under the guidance of the famed viticulturalist André Tchelistcheff, helped spawn the valley's fine-wine renaissance.
Sterling Vineyards, the white stucco winery on a bluff south of Calistoga, was founded in 1964 by British international paper broker Peter Newton and has become one of Napa Valley's most popular tourist destinations.
Diageo Chateau & Estate Wines will continue to manage and operate the properties and will retain ownership and marketing of the wine brands. In return, it will enter into 20-leases for the buildings and 2,000 acres of vineyards. When completed, Diageo will become Realty Income's second-biggest tenant.
The transaction allows Diageo, which has struggled during the recession, to raise cash and increase returns for shareholders.
“We know that to remain competitive in this environment we need to rethink our whole wine business to be more nimble and entrepreneurial,” said Zsoka McDonald, a company spokeswoman. “This is about ensuring the long-term strength of our North America wine business and the health of our core wine brands.”
Diageo's wine and spirits portfolios tend toward the high-end, and it has been hit hard as the alcohol business has proven to be less recession-proof than many thought. It owns such powerhouse brands as Johnnie Walker whiskey, Smirnoff vodka and Guinness stout.
Its wine sales fell 7 percent in 2009. The company announced in May it was restructuring U.S. wine operations, laying off about 14 percent of its workforce and would focus on core wine brands, including Beaulieu Vineyard, Sterling Vineyards, Chalone, Acacia, Rosenblum Cellars and Provenance.
The chief benefit for Diageo is that is can raise cash while paying reasonable leases on the properties, said Joe Ciatti, of Zepponi & Company of Santa Rosa.
“Diageo's saying ‘We've got these wine assets that really don't produce a lot of return for us, and it's better for us to sell those off,' ” Ciatti said.
He said he understood the leases would generate a 6 percent return for Realty Income Corp., a conservative return, he said.
Ciatti ran his own wine industry focused REIT, Vintage Wine Trust, from 2005 to 2008, when he was forced to liquidate it because the returns weren't what investors had hoped.
VinREIT in St. Helena is facing challenges, as well, with several of its properties facing foreclosure.
Nicholson, however, said this deal should work well for Realty Income Corp because it got great properties with a tenant that isn't going anywhere.
“This REIT is smart. They know what they are doing and got some blue-chip assets,” he said.
And wine consumers, whether visiting the Napa tasting rooms or buying the wines in supermarkets, won't notice a difference, Nicholson said.
“This is the same as the way Marriott doesn't own their hotels,” Nicholson said. Sphere: Related Content
US Dept of Justice HQ Sold for $305 Million
Washington Business Journal - June 24, 2010
The Northwestern Mutual Life Insurance Co. has closed on a deal to buy StonebridgeCarras LLC and Walton Street Capital LLC's Two Constitution Square for $305 million.
The 589,000-square-foot project, 145 N St. NE in the NoMa neighborhood behind Union Station, rises to 12 stories and is fully leased to the Department of Justice.
The Department of Justice will fill the building under a 15-year lease and complete its transition into the project in the fourth quarter of the year.
The development team decided to put the project on the market in January because of its long-term lease to the federal government, arguably the most stable tenant in the market.
“It was perfect for what people were looking for in the market. We wanted to find a buyer for a long-term flat deal and in today's world, it became a valuable asset,” said Doug Firstenberg, principal of StonebridgeCarras. “The market is not that deep for someone who can buy a single asset for $300 million.”
Bethesda-based StonebridgeCarras and Chicago-based Walton Street Capital have delivered four of eight floors of Two Constitution Square, part of a larger 2.5-million-square-foot project.
Firstenberg said the price the team netted — about $518 per square foot — was close to what he imagined for the project at its conception, but said he did not expect to sell the project before it delivered.
“This was not in the business plan,” Firstenberg said, laughing.
The first phase of the entire Constitution Square project will deliver a 440-unit apartment building that will open in September, as well as a 50,000-square-foot Harris Teeter that will open in December.
TD Bank, Potbellys Sandwich Works, Georgetown Valet dry cleaner, Constitution Cafe and Tynan Coffee & Tea will fill part of the project's 30,000 square feet of retail and a 204-room Hilton Garden Inn will deliver in the first quarter of 2011.
One Constitution Square, the project's sister building, includes 329,251 square feet and is entirely leased to the U.S. General Services Administration for its headquarters. The development team will sell that project eventually, but opted to put Two Constitution Square on the market first because it had a longer lease than the GSA's, Firstenberg said. The GSA lease is for seven years and gives the federal government the ability to cancel it after five years.
StonebridgeCarras Management will continue to manage the Two Constitution Square building, which is shooting for Leadership in Energy and Environmental Design Platinum certification.
Bill Collins of Cassidy Turley represented the seller in the deal. Cambridge Property Group represented Northwestern Mutual. Sphere: Related Content
The Northwestern Mutual Life Insurance Co. has closed on a deal to buy StonebridgeCarras LLC and Walton Street Capital LLC's Two Constitution Square for $305 million.
The 589,000-square-foot project, 145 N St. NE in the NoMa neighborhood behind Union Station, rises to 12 stories and is fully leased to the Department of Justice.
The Department of Justice will fill the building under a 15-year lease and complete its transition into the project in the fourth quarter of the year.
The development team decided to put the project on the market in January because of its long-term lease to the federal government, arguably the most stable tenant in the market.
“It was perfect for what people were looking for in the market. We wanted to find a buyer for a long-term flat deal and in today's world, it became a valuable asset,” said Doug Firstenberg, principal of StonebridgeCarras. “The market is not that deep for someone who can buy a single asset for $300 million.”
Bethesda-based StonebridgeCarras and Chicago-based Walton Street Capital have delivered four of eight floors of Two Constitution Square, part of a larger 2.5-million-square-foot project.
Firstenberg said the price the team netted — about $518 per square foot — was close to what he imagined for the project at its conception, but said he did not expect to sell the project before it delivered.
“This was not in the business plan,” Firstenberg said, laughing.
The first phase of the entire Constitution Square project will deliver a 440-unit apartment building that will open in September, as well as a 50,000-square-foot Harris Teeter that will open in December.
TD Bank, Potbellys Sandwich Works, Georgetown Valet dry cleaner, Constitution Cafe and Tynan Coffee & Tea will fill part of the project's 30,000 square feet of retail and a 204-room Hilton Garden Inn will deliver in the first quarter of 2011.
One Constitution Square, the project's sister building, includes 329,251 square feet and is entirely leased to the U.S. General Services Administration for its headquarters. The development team will sell that project eventually, but opted to put Two Constitution Square on the market first because it had a longer lease than the GSA's, Firstenberg said. The GSA lease is for seven years and gives the federal government the ability to cancel it after five years.
StonebridgeCarras Management will continue to manage the Two Constitution Square building, which is shooting for Leadership in Energy and Environmental Design Platinum certification.
Bill Collins of Cassidy Turley represented the seller in the deal. Cambridge Property Group represented Northwestern Mutual. Sphere: Related Content
Friday, June 18, 2010
Los Angeles Agency Considers $300 Million Sale Leaseback of HQ
Los Angeles Times - June 14, 2010
The top executive at the Los Angeles Department of Water and Power, the nation's largest municipal utility, is laying the groundwork for a sale of some of the agency's biggest assets — including the utility's iconic downtown Los Angeles headquarters — as it seeks to cover rising costs without raising electricity rates.
DWP Interim General Manager Austin Beutner said Monday that he would not pursue any additional power rate increases for the remainder of the calendar year. But that decision would come with a series of tradeoffs, he said.
Beutner, a former investment banker, is hoping to generate $150 million by selling city-owned natural gas reserves in Wyoming. He is looking at unloading the city's stake in an Arizona coal-fired power plant years ahead of schedule. And he said he is "serious" about trying to sell the utility's 17-story office building on Hope Street to a private buyer, who would lease offices back to the agency on a long-term basis.
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"It's real simple. If you can't raise rates, what are you going to do?" Beutner said.
"Do you want to own a building, or do you want to have renewable energy?" he said. "You pick. I don't care. If you like the building better, that's fine. You can't have both. So policy is about making an informed choice."
The various proposals are part of Beutner's new strategic plan for the nation's largest municipal utility, which will be presented to Mayor Antonio Villaraigosa's five-member DWP board Tuesday. Beutner said the proceeds of the cost-cutting efforts would help pay for upgrading the DWP's aging infrastructure, comply with new government regulations and push ahead with Villaraigosa's directive to get more energy from wind, solar and geothermal sources.
The DWP headquarters, across from the Music Center in downtown, opened in 1965 and was designed by A.C. Martin and Associates. Beutner said the sale of the headquarters could generate $300 million.
Councilman Tom LaBonge voiced strong doubts about selling off critical assets, particularly the DWP headquarters, which is named after former City Council President John Ferraro — LaBonge's boss for 16 years.
"Mr. Beutner is obviously a much better businessman than I," said LaBonge, who voted against electricity rate increases earlier this year. "But as a public official, I wouldn't want to see us sell assets that we might have to buy back again."
Villaraigosa got into a major standoff with the City Council in March over a series of proposed increases that would have boosted residential rates from 9% to 28%, depending on the household. So far, the council has approved a 4.8% increase effective July 1.
In the wake of that dispute, Beutner decided to hold the line on future increases for at least nine months, partly by cutting expenses and partly by tapping DWP assets. Beutner hopes to cancel plans for a new billing office in Van Nuys — a move that could save $20 million — and is weighing a possible sale of 100 acres of property that the DWP owns in Malibu.
The DWP is already scheduled to divest itself of a 21% stake in the Navajo Generating Station, a coal-fired power facility in Arizona, by 2019. But Beutner said he would act far more swiftly to sell that stake, a move that could generate up to $500 million.
One possibility would be to sell the stake within two years while gradually scaling back the city's use of coal from that facility, he said.
That strategy drew strong praise from Rhonda Mills, Southern California program director of the Clean Power Campaign, an environmental advocacy group. Mills said the Navajo plant would lose value as new environmental regulations are put into effect across the nation.
"It will cost us more in the future than if we get out of it now," she said.
Beutner's long-term strategic plan represents the latest shift in direction for a utility that has had five general managers in three years. During much of that time, Villaraigosa has promised to ensure that the DWP gets 20% of its power from renewable energy by Dec. 31 and 40% of its power from those sources by 2020.
By contrast, Beutner said he would focus less on Villaraigosa's numerical target for renewable energy and more on an overall goal: cutting the utility's carbon emissions in half.
Former DWP General Manager H. David Nahai said he retained Goldman Sachs to study the possibility of selling the city's stake in Navajo and purchasing back its power. Still, he voiced dismay at the notion of a lease-back of DWP headquarters.
"We're going to sell a gem of a piece of real estate, an iconic building, in the lowest real estate market since the Great Depression? That does not make sense," he said.
As part of his DWP strategic plan, Beutner said he wants a "ratepayer advocate" to serve as a watchdog on behalf of the utility's customers. That advocate should be housed in the office of City Administrative Officer Miguel Santana, the budget advisor to Villaraigosa and the council, Beutner said.
That marked a change from two weeks ago, when Beutner said he wanted the ratepayer advocate to serve in the office of City Controller Wendy Greuel. Asked about that earlier statement, Beutner said he "may have misspoken."
A June 7 DWP news release also said the utility was working with Greuel to create the ratepayer watchdog. Days later, Greuel released a report sharply criticizing the DWP for threatening to withhold $73 million from the city's budget unless it received its planned rate increase.
Beutner said that having a ratepayer advocate in the controller's office would "politicize" the position. Greuel, in turn, said Beutner's statement on the ratepayer advocate is "the exact opposite" of what he told her two weeks ago.
"It's really obvious that his position changed after I released a critical review of the Department of Water and Power," Greuel said. "That's why this position needs to be independent." Sphere: Related Content
The top executive at the Los Angeles Department of Water and Power, the nation's largest municipal utility, is laying the groundwork for a sale of some of the agency's biggest assets — including the utility's iconic downtown Los Angeles headquarters — as it seeks to cover rising costs without raising electricity rates.
DWP Interim General Manager Austin Beutner said Monday that he would not pursue any additional power rate increases for the remainder of the calendar year. But that decision would come with a series of tradeoffs, he said.
Beutner, a former investment banker, is hoping to generate $150 million by selling city-owned natural gas reserves in Wyoming. He is looking at unloading the city's stake in an Arizona coal-fired power plant years ahead of schedule. And he said he is "serious" about trying to sell the utility's 17-story office building on Hope Street to a private buyer, who would lease offices back to the agency on a long-term basis.
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"It's real simple. If you can't raise rates, what are you going to do?" Beutner said.
"Do you want to own a building, or do you want to have renewable energy?" he said. "You pick. I don't care. If you like the building better, that's fine. You can't have both. So policy is about making an informed choice."
The various proposals are part of Beutner's new strategic plan for the nation's largest municipal utility, which will be presented to Mayor Antonio Villaraigosa's five-member DWP board Tuesday. Beutner said the proceeds of the cost-cutting efforts would help pay for upgrading the DWP's aging infrastructure, comply with new government regulations and push ahead with Villaraigosa's directive to get more energy from wind, solar and geothermal sources.
The DWP headquarters, across from the Music Center in downtown, opened in 1965 and was designed by A.C. Martin and Associates. Beutner said the sale of the headquarters could generate $300 million.
Councilman Tom LaBonge voiced strong doubts about selling off critical assets, particularly the DWP headquarters, which is named after former City Council President John Ferraro — LaBonge's boss for 16 years.
"Mr. Beutner is obviously a much better businessman than I," said LaBonge, who voted against electricity rate increases earlier this year. "But as a public official, I wouldn't want to see us sell assets that we might have to buy back again."
Villaraigosa got into a major standoff with the City Council in March over a series of proposed increases that would have boosted residential rates from 9% to 28%, depending on the household. So far, the council has approved a 4.8% increase effective July 1.
In the wake of that dispute, Beutner decided to hold the line on future increases for at least nine months, partly by cutting expenses and partly by tapping DWP assets. Beutner hopes to cancel plans for a new billing office in Van Nuys — a move that could save $20 million — and is weighing a possible sale of 100 acres of property that the DWP owns in Malibu.
The DWP is already scheduled to divest itself of a 21% stake in the Navajo Generating Station, a coal-fired power facility in Arizona, by 2019. But Beutner said he would act far more swiftly to sell that stake, a move that could generate up to $500 million.
One possibility would be to sell the stake within two years while gradually scaling back the city's use of coal from that facility, he said.
That strategy drew strong praise from Rhonda Mills, Southern California program director of the Clean Power Campaign, an environmental advocacy group. Mills said the Navajo plant would lose value as new environmental regulations are put into effect across the nation.
"It will cost us more in the future than if we get out of it now," she said.
Beutner's long-term strategic plan represents the latest shift in direction for a utility that has had five general managers in three years. During much of that time, Villaraigosa has promised to ensure that the DWP gets 20% of its power from renewable energy by Dec. 31 and 40% of its power from those sources by 2020.
By contrast, Beutner said he would focus less on Villaraigosa's numerical target for renewable energy and more on an overall goal: cutting the utility's carbon emissions in half.
Former DWP General Manager H. David Nahai said he retained Goldman Sachs to study the possibility of selling the city's stake in Navajo and purchasing back its power. Still, he voiced dismay at the notion of a lease-back of DWP headquarters.
"We're going to sell a gem of a piece of real estate, an iconic building, in the lowest real estate market since the Great Depression? That does not make sense," he said.
As part of his DWP strategic plan, Beutner said he wants a "ratepayer advocate" to serve as a watchdog on behalf of the utility's customers. That advocate should be housed in the office of City Administrative Officer Miguel Santana, the budget advisor to Villaraigosa and the council, Beutner said.
That marked a change from two weeks ago, when Beutner said he wanted the ratepayer advocate to serve in the office of City Controller Wendy Greuel. Asked about that earlier statement, Beutner said he "may have misspoken."
A June 7 DWP news release also said the utility was working with Greuel to create the ratepayer watchdog. Days later, Greuel released a report sharply criticizing the DWP for threatening to withhold $73 million from the city's budget unless it received its planned rate increase.
Beutner said that having a ratepayer advocate in the controller's office would "politicize" the position. Greuel, in turn, said Beutner's statement on the ratepayer advocate is "the exact opposite" of what he told her two weeks ago.
"It's really obvious that his position changed after I released a critical review of the Department of Water and Power," Greuel said. "That's why this position needs to be independent." Sphere: Related Content
Thursday, June 03, 2010
7-Eleven Seeking $40 Million Sale Leaseback of 24 U.S. Convenience Stores
CSP Information Group - June 3, 2010
7-Eleven Inc. has retained Mehran Foroughi, senior vice president for Colliers International, the third-largest real-estate services organization globally, to sell 24 retail properties anchored by 7-Eleven. The portfolio, valued at approximately $40 million, is owned and operated by 7-Eleven.
The 7-Eleven anchored properties, primarily located in California and throughout the United States, all include at least one co-tenant, with AutoZone as a co-tenant in some locations. All of the 7-Eleven convenience store leases are triple net lease (NNN) and guaranteed by 7-Eleven.
"Colliers International was retained by 7-Eleven as the listing broker because of our aggressive, targeted marketing platform," said Foroughi, the exclusive listing agent for the portfolio. "We are marketing the properties as a portfolio, although offers on individual sites are also welcome."
Based in Dallas, 7-Eleven is the world's largest operator, franchisor and licensor of convenience stores with more than 37,600 units worldwide of which more than 8,100 are in North America.
The announcement follows the early March sale of a portfolio of a dozen 7-Eleven stores to several buyers for a combined value of more than $20 million. The stores retained the 7-Eleven brand in what were essentially sale-leaseback arrangements. "Their intention is not to leave, their intention was just to unload this property as a landlord," Colliers representative Mehran Foroughi told CSP Daily News about the Dallas-based retail giant at the time.
The 12 locations in Nevada, Texas and Virginia were acquired from 7-Eleven through all-cash deals.
Foroughi, said that five stores in the Dallas metropolitan area were sold to a California buyer. The six stores in Virginia were claimed by three individual buyers and the lone store in Las Vegas ended up in the portfolio of a Dallas-based company. Sphere: Related Content
7-Eleven Inc. has retained Mehran Foroughi, senior vice president for Colliers International, the third-largest real-estate services organization globally, to sell 24 retail properties anchored by 7-Eleven. The portfolio, valued at approximately $40 million, is owned and operated by 7-Eleven.
The 7-Eleven anchored properties, primarily located in California and throughout the United States, all include at least one co-tenant, with AutoZone as a co-tenant in some locations. All of the 7-Eleven convenience store leases are triple net lease (NNN) and guaranteed by 7-Eleven.
"Colliers International was retained by 7-Eleven as the listing broker because of our aggressive, targeted marketing platform," said Foroughi, the exclusive listing agent for the portfolio. "We are marketing the properties as a portfolio, although offers on individual sites are also welcome."
Based in Dallas, 7-Eleven is the world's largest operator, franchisor and licensor of convenience stores with more than 37,600 units worldwide of which more than 8,100 are in North America.
The announcement follows the early March sale of a portfolio of a dozen 7-Eleven stores to several buyers for a combined value of more than $20 million. The stores retained the 7-Eleven brand in what were essentially sale-leaseback arrangements. "Their intention is not to leave, their intention was just to unload this property as a landlord," Colliers representative Mehran Foroughi told CSP Daily News about the Dallas-based retail giant at the time.
The 12 locations in Nevada, Texas and Virginia were acquired from 7-Eleven through all-cash deals.
Foroughi, said that five stores in the Dallas metropolitan area were sold to a California buyer. The six stores in Virginia were claimed by three individual buyers and the lone store in Las Vegas ended up in the portfolio of a Dallas-based company. Sphere: Related Content
Tuesday, June 01, 2010
Abba Enters EUR 33 Million Sale Leaseback of Hotel in Madrid
PropertyEU - June 1, 2010
Hotel chain Abba has sold the Abba Castilla Plaza de Madrid in a EUR 33 mln sale-and-leaseback transaction. The deal reflects a yield of over 7%. The buyers are a consortium of private investors led by Grupo Milenium.
The four-star hotel offers 228 rooms and is located in the northern part of the city. As part of the agreement, Abba has signed an option to buy the hotel back after 10 years.
Aguirre Newman advised Abba, CB Richard Ellis acted for the buyers. Sphere: Related Content
Hotel chain Abba has sold the Abba Castilla Plaza de Madrid in a EUR 33 mln sale-and-leaseback transaction. The deal reflects a yield of over 7%. The buyers are a consortium of private investors led by Grupo Milenium.
The four-star hotel offers 228 rooms and is located in the northern part of the city. As part of the agreement, Abba has signed an option to buy the hotel back after 10 years.
Aguirre Newman advised Abba, CB Richard Ellis acted for the buyers. Sphere: Related Content
State of Arizona Seeking $300 Million Sale Leaseback of State Owned Properties to Ease Budget Deficit
The Arizona Republic - June 1, 2010
More state buildings go up for sale next week, as officials hope to raise $300 million by selling and then leasing back the schools for deaf and blind children, more state prisons and other structures in an attempt to raise $300 million.
It's the second time this year that the state has sold off buildings to help close the state budget deficit. A sale-leaseback in January raised $735.4 million for the state. The healthy response prompted lawmakers to authorize a second sale.
The sale will be conducted June 8, and investors will be required to make purchases in $5,000 installments, according to information on the Arizona Department of Administration's Web site.
Investors must work through a list of underwriters provided by the state.
The sale-leaseback comes on the heels of last week's action in which the state borrowed $450 million against the proceeds of future state Lottery revenues. Those bonds carried an interest rate of 4.27 percent.
Next week's sale-leaseback is expected to carry a similar interest rate, said Michael Smarik, deputy state comptroller, although the rate won't be set until next week. Sphere: Related Content
More state buildings go up for sale next week, as officials hope to raise $300 million by selling and then leasing back the schools for deaf and blind children, more state prisons and other structures in an attempt to raise $300 million.
It's the second time this year that the state has sold off buildings to help close the state budget deficit. A sale-leaseback in January raised $735.4 million for the state. The healthy response prompted lawmakers to authorize a second sale.
The sale will be conducted June 8, and investors will be required to make purchases in $5,000 installments, according to information on the Arizona Department of Administration's Web site.
Investors must work through a list of underwriters provided by the state.
The sale-leaseback comes on the heels of last week's action in which the state borrowed $450 million against the proceeds of future state Lottery revenues. Those bonds carried an interest rate of 4.27 percent.
Next week's sale-leaseback is expected to carry a similar interest rate, said Michael Smarik, deputy state comptroller, although the rate won't be set until next week. Sphere: Related Content
Greek Government Seeking Sale Leaseback of up to EUR 1 Billion in State Owned Property
Greek Reporter - May 31, 2010
From what is seems, the green light has given in order for the new privatization program of state owned enterprises. Over 1 billion euros in revenue is expected if the program is put into action.
In an pushed meeting, which took place last Saturday under the chairmanship of the Minister for Finance, Mr. G. Papakonstantinou with the participation of the Minister’s of Infrastructure, Energy and Tourism, plus twelve general secretaries of different ministries, accepted the plan will present it to the members of the MP’s Board.
According to each enterprise there will be, a percentage sale or the total of the company, or the quest of “strategic investors”, or the opportunity to let public property a specified period of time.
The new privatization program states the following:
Percentage sale to citizens, without, rulling out the possibility of also passing the management along also.
Percentage sale of the company. In the time being, the scenario of further equity is removed form the table of discussion, as the economic team believes that this move is not appropriate during this period, whereas the stock market values are low.
DEPA: Will give away a percentage, as also, the management to private individuals.
Casinos: Shall be privatized
Airports – Ports – Highways: Property: Are decided to proceed with the waiver holding to individuals for 30 or 40 years (sale & lease back). Sphere: Related Content
From what is seems, the green light has given in order for the new privatization program of state owned enterprises. Over 1 billion euros in revenue is expected if the program is put into action.
In an pushed meeting, which took place last Saturday under the chairmanship of the Minister for Finance, Mr. G. Papakonstantinou with the participation of the Minister’s of Infrastructure, Energy and Tourism, plus twelve general secretaries of different ministries, accepted the plan will present it to the members of the MP’s Board.
According to each enterprise there will be, a percentage sale or the total of the company, or the quest of “strategic investors”, or the opportunity to let public property a specified period of time.
The new privatization program states the following:
Percentage sale to citizens, without, rulling out the possibility of also passing the management along also.
Percentage sale of the company. In the time being, the scenario of further equity is removed form the table of discussion, as the economic team believes that this move is not appropriate during this period, whereas the stock market values are low.
DEPA: Will give away a percentage, as also, the management to private individuals.
Casinos: Shall be privatized
Airports – Ports – Highways: Property: Are decided to proceed with the waiver holding to individuals for 30 or 40 years (sale & lease back). Sphere: Related Content
Sunday, May 30, 2010
JV Proposes Tax Exempt Financing to Fund $2.2 Billion Sale Leaseback of State of CA Office Buildings
NASDAQ.com - May 21, 1010
AEW Capital Management and the California Municipal Finance Authority have submitted a unique bid to acquire an 11-property portfolio of office buildings from the state of California. The partnership, which is one of seventeen potential buyers that submitted second-round bids, gave the only proposal that aims to keep the properties in the public domain. The portfolio is valued at about $2.2 billion.
In the proposal, CMFA would acquire the portfolio via tax-exempt lease revenue bonds that would pay about 5%. AEW, which would not put any capital into the transaction, would act as the asset manager while a trustee would be appointed to receive the lease payments on behalf of the bond holders. A brokerage firm would be hired to manage the properties.
This structure would allow the proceeds from any future sale to stay in the public domain. At the time of a sale, roughly 50% of proceeds would be given back to the CMFA's constituent local authorities and the rest would go to various affiliated non-profit organizations.
The rest of the offers were for more standard sale-lease backs.
Although there is a 2004 California law that prohibits state-affiliated public entities from assuming additional long-term debt, CMFA is a Joint Powers of Authority that is focused on financing economic development and charitable initiatives for local authorities and therefore is exempt from the law.
A response is expected this week, with the state selecting three to five final bidders. If AEW's proposal were selected to go forward, the individual jurisdictions where the properties are located would have to approve the transaction. Sphere: Related Content
AEW Capital Management and the California Municipal Finance Authority have submitted a unique bid to acquire an 11-property portfolio of office buildings from the state of California. The partnership, which is one of seventeen potential buyers that submitted second-round bids, gave the only proposal that aims to keep the properties in the public domain. The portfolio is valued at about $2.2 billion.
In the proposal, CMFA would acquire the portfolio via tax-exempt lease revenue bonds that would pay about 5%. AEW, which would not put any capital into the transaction, would act as the asset manager while a trustee would be appointed to receive the lease payments on behalf of the bond holders. A brokerage firm would be hired to manage the properties.
This structure would allow the proceeds from any future sale to stay in the public domain. At the time of a sale, roughly 50% of proceeds would be given back to the CMFA's constituent local authorities and the rest would go to various affiliated non-profit organizations.
The rest of the offers were for more standard sale-lease backs.
Although there is a 2004 California law that prohibits state-affiliated public entities from assuming additional long-term debt, CMFA is a Joint Powers of Authority that is focused on financing economic development and charitable initiatives for local authorities and therefore is exempt from the law.
A response is expected this week, with the state selecting three to five final bidders. If AEW's proposal were selected to go forward, the individual jurisdictions where the properties are located would have to approve the transaction. Sphere: Related Content
Wednesday, May 19, 2010
Banca Monte dei Paschi di Siena Seeking EUR 1.8 Billion Sale Leaseback of Italian Property Portfolio
PropertyEU - May 19, 2010
French insurer AXA Real Estate is taking part in a consortium that is bidding for EUR 1.8 bn worth of property from Siena-based bank Banca Monte dei Paschi di Siena (MPS). Under the sale-and-leaseback plan, the Italian bank would retain a 30% stake in the portfolio with the rest split between Italian property company Sansedoni (40%), AXA Real Estate (20%) and investment bank Mediobanca (10%).
MPS expects to post a capital gain of EUR 443 mln from the sale which is aimed at boosting the bank's capital and liquidity ratios. During the presentation of the bank's first-quarter results, Chief Executive Alberto Vigni said he was 'confident' that the deal would be completed this year.
The lender is currently discussing the sale and leaseback of the property with the Bank of Italy. The operation will see MPS transfer the assets to a new company, Perimetro Gestione Proprietà Immobiliari, which will be seeking new investors in the coming months.
The sale of MPS' real estate was first announced in late 2008 but came to a halt last year due to a change in legislation introduced by the Bank of Italy.
MPS is also working on two other real estate asset disposals. In March, MPS put around 370 bank branches worth around EUR 700 mln on the market and said it was planning to sell around EUR 500 mln worth of properties consisting of 266 branches no longer strategic. Sphere: Related Content
French insurer AXA Real Estate is taking part in a consortium that is bidding for EUR 1.8 bn worth of property from Siena-based bank Banca Monte dei Paschi di Siena (MPS). Under the sale-and-leaseback plan, the Italian bank would retain a 30% stake in the portfolio with the rest split between Italian property company Sansedoni (40%), AXA Real Estate (20%) and investment bank Mediobanca (10%).
MPS expects to post a capital gain of EUR 443 mln from the sale which is aimed at boosting the bank's capital and liquidity ratios. During the presentation of the bank's first-quarter results, Chief Executive Alberto Vigni said he was 'confident' that the deal would be completed this year.
The lender is currently discussing the sale and leaseback of the property with the Bank of Italy. The operation will see MPS transfer the assets to a new company, Perimetro Gestione Proprietà Immobiliari, which will be seeking new investors in the coming months.
The sale of MPS' real estate was first announced in late 2008 but came to a halt last year due to a change in legislation introduced by the Bank of Italy.
MPS is also working on two other real estate asset disposals. In March, MPS put around 370 bank branches worth around EUR 700 mln on the market and said it was planning to sell around EUR 500 mln worth of properties consisting of 266 branches no longer strategic. Sphere: Related Content
Caja Madrid Agrees to EUR 108 Million Sale Leaseback of Office & Data Center in Madrid
europapress.es (as translated by Google) - May 18, 2010
Caja Madrid has reached an agreement on 'sale and leaseback' in Las Rozas (Madrid) with the German fund SEB ImmoPortfolio Target Return Fund, the manager of SEB Asset Management, by which the entity obtained a revenue of 108 million and a total capital gain of EUR 48 million, reported the state.
The commitment of the lease is 30 years. Caja Madrid use the income to strengthen its capital ratios and improve their creditworthiness, in line with the strategy followed during the first quarter of the year, which ran the sale and lease back 83 branches with total capital gains obtained from 55.2 million euros.
The transaction Caja Madrid reserve a right of first offer over the lease period and in case of transfer by the lessee.
The building, which houses the computer-based Caja Madrid, is in the Madrid suburb of Las Rozas, is National Architecture Award and has an area of 43,700 square meters with 537 parking spaces.
The property is part of a business park established in the mid-nineties with excellent access and communications in the northwest axis of the Community of Madrid. Sphere: Related Content
Caja Madrid has reached an agreement on 'sale and leaseback' in Las Rozas (Madrid) with the German fund SEB ImmoPortfolio Target Return Fund, the manager of SEB Asset Management, by which the entity obtained a revenue of 108 million and a total capital gain of EUR 48 million, reported the state.
The commitment of the lease is 30 years. Caja Madrid use the income to strengthen its capital ratios and improve their creditworthiness, in line with the strategy followed during the first quarter of the year, which ran the sale and lease back 83 branches with total capital gains obtained from 55.2 million euros.
The transaction Caja Madrid reserve a right of first offer over the lease period and in case of transfer by the lessee.
The building, which houses the computer-based Caja Madrid, is in the Madrid suburb of Las Rozas, is National Architecture Award and has an area of 43,700 square meters with 537 parking spaces.
The property is part of a business park established in the mid-nineties with excellent access and communications in the northwest axis of the Community of Madrid. Sphere: Related Content
Marks & Spencer Enters £300 Million Sale Leaseback of UK Store Portfolio to Help Fund Pension Deficit
MSN Money UK - May 13, 2010
High street chain Marks and Spencer has agreed a pension funding package worth £800 million in a bid to close the scheme's deficit, it has been announced.
The group's defined benefit scheme, which has 123,000 members, faced a £1.3 billion shortfall when its last valuation was carried out at the end of March last year.
In order to close this, M&S has agreed to pay in an additional £376 million between now and 2018.
It will contribute £35 million a year for the next three years, rising to £60 million for the remainder of the period, on top of the regular contributions it already makes.
The fund will also benefit from a further £300 million through an additional interest in property owned by M&S.
Under the partnership, an interest in property, including stores, is transferred to the pension scheme and then leased back by M&S, providing the pension with an annual income.
The partnership is already generating around £72 million a year for the scheme until 2022, while the latest transfer will contribute a further £36 million annually for 15 years from 2017.
The group will also transfer assets worth £124 million to the pension scheme from existing US dollar hedge contracts.
The £500 million difference between the current deficit and the additional contributions M&S plans to make should be made up by investment returns on the scheme's existing assets.
M&S said the funding plan should not have a "material impact" on the group's net assets or its income statement. Sphere: Related Content
High street chain Marks and Spencer has agreed a pension funding package worth £800 million in a bid to close the scheme's deficit, it has been announced.
The group's defined benefit scheme, which has 123,000 members, faced a £1.3 billion shortfall when its last valuation was carried out at the end of March last year.
In order to close this, M&S has agreed to pay in an additional £376 million between now and 2018.
It will contribute £35 million a year for the next three years, rising to £60 million for the remainder of the period, on top of the regular contributions it already makes.
The fund will also benefit from a further £300 million through an additional interest in property owned by M&S.
Under the partnership, an interest in property, including stores, is transferred to the pension scheme and then leased back by M&S, providing the pension with an annual income.
The partnership is already generating around £72 million a year for the scheme until 2022, while the latest transfer will contribute a further £36 million annually for 15 years from 2017.
The group will also transfer assets worth £124 million to the pension scheme from existing US dollar hedge contracts.
The £500 million difference between the current deficit and the additional contributions M&S plans to make should be made up by investment returns on the scheme's existing assets.
M&S said the funding plan should not have a "material impact" on the group's net assets or its income statement. Sphere: Related Content
Thursday, May 13, 2010
Bellevue Office Tower Leased to Microsoft Trades for $310 Million
CoStar Group - May 12, 2010
What do you do in this market if you're raising money like crazy to invest in commercial real estate -- as much as $100 million a month? If you're Cole Credit Property Trust III Inc., a non-traded REIT in Phoenix, AZ, you spend like crazy, too.
The registered REIT sponsored by Cole Real Estate Investments is in the midst of a two-year public stock offering that has been ongoing since October 2008. As of May 1, Cole Credit III had raised $1.5 billion. So far, it has invested primarily in retail-related buildings net leased to investment-grade and other creditworthy tenants, typically necessity retailers such as drug stores, family restaurants and home improvement stores.
But now the REIT has an even bigger fish on the line. On April 30, one of its subsidiaries agreed to spend $310 million to purchase the 583,000-square-foot City Center at 555 110th St. in Bellevue, WA - a hefty $530 per square foot.
The property is 99.6% occupied, of which approximately 96.3% is subject to a net lease with Microsoft Corp. that expires in June 2024. Microsoft is currently paying an annual base rent of $18.8 million - an amount that increases annually by approximately 2.4% of the then-current annual base rent.
An affiliate of Beacon Capital in Boston, MA, currently owns the building and up until last month had reportedly been in discussions to the sell the building to a German investment fund for about $286 million.
Cole Credit III is expected to close on the deal by June 18, 2010.
This is not the typical deal for the Cole Credit III. As of May 5, it owned 205 properties in 37 states, comprising approximately 5.3 million gross rentable square feet of commercial space and approximately 6.3 million square feet of land subject to ground leases. The typical deal size has been in the $1 million to $6 million range. And that still makes up the bulk of its activity
Besides, the City Center, it is also under contract to make the following purchases this month.
LA Fitness - League City, TX, 45,000 SF, for $7,335,000.
Walgreens - Rocky Mount, NC, 14,820 SF, for $5,863,000.
O'Reilly Automotive - Central, LA, 6,800 SF, for $927,000.
Evans Exchange - Evans, GA, 194,960 SF, for $19,500,000.
Lowe's - South Lebanon, OH, ground lease, for $4,808,000.
Kohl's - South Lebanon, OH, ground lease, for $3,125,000.
White Castle - South Lebanon, OH, ground lease, for $467,000.
Northern Tool - Ocala, FL, 26,054 SF, for $3,518,000.
Walgreens - Lancaster (Palmdale), CA, 13,650 SF, for $5,537,000.
Walgreens - Beloit, WI, 14,820 SF, for $4,310,000. Sphere: Related Content
What do you do in this market if you're raising money like crazy to invest in commercial real estate -- as much as $100 million a month? If you're Cole Credit Property Trust III Inc., a non-traded REIT in Phoenix, AZ, you spend like crazy, too.
The registered REIT sponsored by Cole Real Estate Investments is in the midst of a two-year public stock offering that has been ongoing since October 2008. As of May 1, Cole Credit III had raised $1.5 billion. So far, it has invested primarily in retail-related buildings net leased to investment-grade and other creditworthy tenants, typically necessity retailers such as drug stores, family restaurants and home improvement stores.
But now the REIT has an even bigger fish on the line. On April 30, one of its subsidiaries agreed to spend $310 million to purchase the 583,000-square-foot City Center at 555 110th St. in Bellevue, WA - a hefty $530 per square foot.
The property is 99.6% occupied, of which approximately 96.3% is subject to a net lease with Microsoft Corp. that expires in June 2024. Microsoft is currently paying an annual base rent of $18.8 million - an amount that increases annually by approximately 2.4% of the then-current annual base rent.
An affiliate of Beacon Capital in Boston, MA, currently owns the building and up until last month had reportedly been in discussions to the sell the building to a German investment fund for about $286 million.
Cole Credit III is expected to close on the deal by June 18, 2010.
This is not the typical deal for the Cole Credit III. As of May 5, it owned 205 properties in 37 states, comprising approximately 5.3 million gross rentable square feet of commercial space and approximately 6.3 million square feet of land subject to ground leases. The typical deal size has been in the $1 million to $6 million range. And that still makes up the bulk of its activity
Besides, the City Center, it is also under contract to make the following purchases this month.
LA Fitness - League City, TX, 45,000 SF, for $7,335,000.
Walgreens - Rocky Mount, NC, 14,820 SF, for $5,863,000.
O'Reilly Automotive - Central, LA, 6,800 SF, for $927,000.
Evans Exchange - Evans, GA, 194,960 SF, for $19,500,000.
Lowe's - South Lebanon, OH, ground lease, for $4,808,000.
Kohl's - South Lebanon, OH, ground lease, for $3,125,000.
White Castle - South Lebanon, OH, ground lease, for $467,000.
Northern Tool - Ocala, FL, 26,054 SF, for $3,518,000.
Walgreens - Lancaster (Palmdale), CA, 13,650 SF, for $5,537,000.
Walgreens - Beloit, WI, 14,820 SF, for $4,310,000. Sphere: Related Content
Monday, May 10, 2010
Barclays Seeking Sale Leaseback of 34 Bank Branches in Spain
i-comparables.com - May 6, 2010
Barclays have put up another Spanish commercial property investment portfolio for sale and leaseback, this time of 34 bank branches.
The bank has a network of 586 branches throughout Spain and has been selling many of these over the last few years. In 2008 it sold 24 branches to Redevco in a transaction reported at €65m. The bank also sold a unit in Paseo de Gracia, Barcelona some 12 months ago for around €20m. Colliers International acted in one of the last portfolio sale and leaeback transactions for nine Barclays bank branches around Spain towards the end of 2009.
The largest transaction recorded by i-comparables.com for Barclays in the Spanish real estate investment market took place in 2006 for a price of around €115m. This was for the office investment building located at Calle Mateo Inurria, Madrid, Spain.
According to sources close to the transaction the current offering is the last Spanish property investment transaction which Barclays intend to undertake this year. Jones Lang LaSalle have been given the exclusive mandate. Sphere: Related Content
Barclays have put up another Spanish commercial property investment portfolio for sale and leaseback, this time of 34 bank branches.
The bank has a network of 586 branches throughout Spain and has been selling many of these over the last few years. In 2008 it sold 24 branches to Redevco in a transaction reported at €65m. The bank also sold a unit in Paseo de Gracia, Barcelona some 12 months ago for around €20m. Colliers International acted in one of the last portfolio sale and leaeback transactions for nine Barclays bank branches around Spain towards the end of 2009.
The largest transaction recorded by i-comparables.com for Barclays in the Spanish real estate investment market took place in 2006 for a price of around €115m. This was for the office investment building located at Calle Mateo Inurria, Madrid, Spain.
According to sources close to the transaction the current offering is the last Spanish property investment transaction which Barclays intend to undertake this year. Jones Lang LaSalle have been given the exclusive mandate. Sphere: Related Content
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