Sale Leaseback Financing

Another sale leaseback completed…………….

admin — Wed, 23 Jun 2010 13:02:45 +0000

“W. P. Carey and Sun Products Complete $41 Million Build to Suit Financing for Distribution Center

NEW YORK, NY — 06/22/10 — Investment firm W. P. Carey & Co. LLC (NYSE: WPC) announced today that CPA®:17 - Global, one of its publicly held non-traded REIT affiliates, has agreed to provide build to suit financing for a distribution center in Bowling Green, Kentucky for The Sun Products Corporation, a leading North America provider of fabric and dish care products. The financing will total approximately $41 million. When completed, the 1.4 million square foot facility will be leased to Sun Products under a long term triple net lease and will enable the company to consolidate operations of nine other facilities in the Bowling Green area. Located adjacent to one of Sun Products’ four manufacturing plants, the distribution center will be one of two distribution facilities serving the entire East Coast.

The Sun Products Corporation, headquartered in Wilton, Connecticut, was established in September 2008 by the merger of Unilever’s North American fabric care business and Huish Detergents Inc. The company’s product portfolio includes well known brands in the laundry and dish care market, including Wisk, all, Sunlight, and Snuggle, as well as many laundry and dish care private label brands for retailers. Sun Products is a portfolio company of private equity firm, Vestar Capital. “

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7-Eleven Sale Leaseback

admin — Fri, 04 Jun 2010 13:22:11 +0000

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

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Another State Involved in Sale-Leaseback Financing

admin — Wed, 02 Jun 2010 20:50:12 +0000

State selling more buildings
to ease budget deficit

by Mary Jo Pitzl - Jun. 2, 2010 12:00 AM
The Arizona Republic

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.

It’s the second time this year that the state has sold 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. Proceeds will be
used to balance the current-year budget.

The sale begins Tuesday, and will continue until the $300 million has been raised.
Investors will be required to make purchases in $5,000 installments, according to
information on the Arizona Department of Administration’s website.

Investors must work through a list of underwriters provided by the state.

A full listing can be found at www.azdoa.gov/news.

The state retains control of the buildings, which it will continue to occupy and lease
back from investors.

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. The money also will help balance the current-year budget. 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.

While the sale-leaseback provides quick cash for the state, it also costs the state more in
the long run. The $735 million sale-leaseback from earlier this year carried $400
million in interest costs over 30 years, for a total payback of $1.1 billion.

It’s hard to calculate the cost to the state of Tuesday’s offering until the interest rate is
set.

Sale-leaseback, sale and leaseback, sale leaseback, leaseback

WP Carey does another deal………..

admin — Fri, 28 May 2010 16:51:07 +0000

“W. P. Carey Completes Acquisition of Two JPMorgan Chase Facilities in Tampa

May 24, 2010

New York, NY – May 24, 2010 – Investment firm W. P. Carey & Co. LLC (NYSE: WPC) announced today that CPA^®:17 – Global, one of its publicly held non-traded REIT affiliates, has purchased two office facilities in Tampa, Florida from Brookfield Real Estate Opportunity Group (“Brookfield”), an affiliate of Brookfield Asset Management. Located in the Westshore area adjacent to Tampa International Airport, the two facilities total approximately 312,000 square feet and are leased to JPMorgan Chase, National Association on a long term basis. This transaction follows W. P. Carey’s February purchase from Brookfield of a 386,000 square foot operations center in Dallas leased to JPMorgan Chase.”

This was announce on their web site.

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Kodak contemplates short term sale leaseback………….

admin — Tue, 25 May 2010 20:57:52 +0000

NCBR Article

Kodak puts three buildings up for sale

May 25, 2010 –

WINDSOR
- Eastman Kodak Co. decided to list for sale three of its buildings on
the Windsor campus.

In all, the offering includes 725,000 square
feet in facilities, on the northern end of the property, and 320 acres
of vacant land. The price has not been disclosed.

Kodak is
consolidating its operations into two buildings - known as C-15 and C-29
- totaling 825,000 square feet. The facilities house color photographic
paper and thermal media manufacturing. According to the listing from
broker CB Richard Ellis, Kodak is also offering an opportunity to enter
into a four-year leaseback on the C-15 facility.

“By
consolidating into these two buildings and eliminating the costs
associated with the empty buildings, we will ensure that our Colorado
site remains very cost competitive and supports the long-term success of
the color paper and thermal media operations, which are both important
to Kodak,” said Robert Gray, Windsor site manager, in a press release
announcing the listings.

Kodak has been in flux for years, as the
company shifted its focus from traditional to digital photography. The
company came to Windsor in 1969 and at its peak during the 1980s
employed 3,500. In 2007, the company spun off its health-products
business Carestream Health Inc., with each company employing about 800
in Windsor immediately following the split. Carestream now employs
around 450 locally.

In 2009, Kodak implemented a company-wide
restructuring program that cut at least 300 employees from the site.
Today, the company employs 360 in Windsor.

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Irish Company Sale Leaseback

admin — Fri, 21 May 2010 13:42:24 +0000

AIB puts prized branch back on the market

Wed, May 12, 2010

The bank is selling its key asset on Grafton Street in order to meet higher liquidity benchmarks set by the Financial Regulator, writes JACK FAGAN

FOUR MONTHS after blocking the sale of its most valuable bank branch on Dublin’s Grafton Street, senior management in AIB has reversed its decision and put the building back on the market.

Estate agent Colm Luddy of CB Richard Ellis will be hoping to secure at least a similar offer of just under €28 million for the branch in a sale and leaseback deal. At that value, an investor would get a return of almost 6 per cent.

AIB’s surprise decision to proceed with the disposal of the high profile building comes at a time when it is under pressure to strengthen its capital and liquidity ratios.

The original sale to a UK-based investor was due to have been completed early in January but was blocked by the newly appointed managing director Colm Doherty on the grounds that it was their most valuable property and it should not be disposed of at a time when the investment market favoured purchasers rather than vendors.

With the bank now needing €7.4 billion to reach new capital ratios set by the Financial Regulator by the end of this year, it could hardly be seen to be holding on to one of the most valuable retail buildings in the city while availing of a State bailout.

The bank will only raise about €4 billion from the sale of Polish, UK and US businesses.

CBRE is understood to have reopened negotiations with most of the original bidders, some of them based in the UK, and the expectation is that a sale will be agreed in the short term.

The Grafton Street building has a dual frontage on to Wicklow Street and is the busiest of all its Dublin branches. The sale and leaseback terms include a 20-year lease with a 15-year break option. The initial rent will be close to €1.8 million per annum.

In the last significant investment sale on Grafton Street, the German banking group DekaBank bought the Tommy Hilfiger store on the opposite side of the street for €25 million, reflecting a yield of 6.4 per cent. The bank is an infinitely better investment with a ground floor area of 464sq m (5,000sq ft) and the great advantage of dual frontage.

Despite the hesitancy about selling the Grafton Street building, AIB is expected to push ahead with the sale and leaseback of other parts of its branch network as a means of unlocking equity for its core business. It has already sold more than 70 branches since it launched its first tranche of buildings at the peak of the property market in autumn 2006.

The first dozen branches showed an initial yield for investors of only 2.8 per cent. The most recent portfolio of buildings gave investors a return of between 6.25 and 7.25 per cent.

sale-leaseback, sale and leaseback, leaseback

Sale Leaseback and Build to Suit News

admin — Thu, 13 May 2010 16:43:19 +0000

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.

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More Sale Leaseback Activity

admin — Thu, 06 May 2010 17:33:18 +0000

Another company took advantage of the benefits of sale-leaseback financing this week this week.

Venter Institute completes a sale-leaseback financing on their Maryland property for $53,000,000. A 10 year lease with options was negotiated with BioMet Realty Trust.

WP Carey announced the completion of a couple of sale leaseback transactions overseas- a $34,000,000 sale leaseback with TDG, a UK logistics and supply chain company and a $10,000.000 deal with Agrokor, the largest private company and food retailer in Croatia.

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Sale Leaseback Financing Overseas

admin — Tue, 04 May 2010 14:39:57 +0000

Sale leaseback financing appears to be picking up in the U.S. as well as overseas.

Here are a few sale leaseback deals recently announce overseas:

AEW fund buys Spanish retail portfolio for $200 million in a sale and leaseback of a portfolio of retail units across Spain from Spanish supermarket chain Eroski.

HAISAN Resources Bhd has partnered Global Logistic Properties Investment Management (China) Co Ltd for the sale and leaseback of Haisan’s land, building and part of the refrigeration equipments for 120 million renminbi.

Standard Life Investments has completed a sale and leaseback from Tesco Extra Supermarket in Shrewsbury, Shropshire.

Sale Leaseback, Sale-leaseback, Leaseback

How is California’s decision to pursue Sale Leaseback financing viewed?

admin — Fri, 30 Apr 2010 16:38:41 +0000

Interesting article ………………………………………………….

“State building ’sale-leaseback’ called ‘poor fiscal policy’

Posted at 08:25 AM on Wednesday, Apr. 28, 2010

By Kevin Yamamura

California would incur significant long-term lease costs by selling 11 state office properties, the Legislative Analyst’s Office said Tuesday as it assailed the move as “poor fiscal policy.”

But given the array of bad budget-balancing options, the nonpartisan office did not necessarily recommend that the state reject the entire transaction.

Gov. Arnold Schwarzenegger and state lawmakers agreed last year to sell 11 high-profile state office buildings to private investors and then lease them back for at least 20 years. The Republican governor, a proponent of privatizing more state functions, had pushed for the “sale-leaseback” transactions in budget negotiations.

The analysts’ report says the plan represents a “bad budgeting practice.”

Essentially, the state would reap a onetime gain to plug its budget deficit in exchange for decades of lease costs.

The analysts estimated the state would pay an effective interest rate of 7.1 percent to 14.3 percent for that onetime money. The immediate revenue and effective interest rate depend on the sale price.

The most significant costs would come in two to three decades, after the state pays its bond debt on the buildings. Leasing, rather than owning, would initially cost about $30 million a year but could balloon to more than $200 million annually in 20 years, according to the Legislative Analyst’s Office.

Schwarzenegger in January estimated the state would net $593 million from selling the buildings, based on a $1.7 billion sale of the properties and paying off $1.1 billion in debt and transaction costs, the report states.

The Schwarzenegger administration announced last week that it had received more than 300 bids for some or all of the state office building portfolio, which includes the East End complex and attorney general’s office building in downtown Sacramento.

CB Richard Ellis, hired by the state to broker the sale, said that because the state had received multiple bids over $2 billion for the entire portfolio, the state plans to sell all of the properties to one buyer.

The state Department of General Services is not saying how much beyond $2 billion the portfolio bids are. Under the most optimistic assumption, legislative analysts said a $2.5 billion sale would net the state $1.4 billion in onetime money.

The analysts recommended that the Legislature look for other solutions, especially if the sale occurs at the lower end of estimates. It also suggested the Legislature could look at each property sale individually, perhaps selling only those that have high operating costs.

Lawmakers already gave their blessing to the idea in last year’s budget negotiations, but Schwarzenegger must give lawmakers 30 days to review the plan once the governor agrees to proceed with the sale. The Legislature likely would have to pass a new bill to stop the proposal.”

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