Daily News: June 3, 2013

GE Capital to Sell $1.45B Retail Property Portfolio

American Realty Capital Trust IV (ARCT IV) said it has entered into an agreement to purchase from GE Capital a $1.45 billion portfolio of retail properties, part of the formerly publicly traded Trustreet Properties. The property portfolio contains a highly diversified mix of 986 net lease properties, including 117 distinct brands, located in 47 different states.

It is made up of primarily long term leases, with a weighted average remaining lease duration of 10.6 years. All of the portfolio’s tenants are concentrated in the retail sector, including the following top ten nationally recognized quick service restaurant brands: Wendy’s; Applebee’s; Burger King; Pizza Hut; KFC; Golden Corral; Arby’s; Taco Bell; Popeyes and Johnny Carino’s.

ARCT IV said it anticipates fully deploying its equity capital and completing its initial acquisitions stage in the next 60 days. At such time, ARCT IV will have assembled a portfolio of approximately $2.3 billion, composed of the newly acquired $1.45 billion GE Capital portfolio, $590 million of previously acquired properties, and approximately $318 million of acquisitions under executed purchase and sale agreements, inclusive of closing costs. The company expects to complete the major portion of the GE Capital acquisition within 30 days and the balance shortly thereafter. The company will consummate this transaction using existing proceeds from its recently completed $1.7 billion equity raise plus some portion of its $750 million of recently announced financing commitments, as needed.

Nicholas S. Schorsch, chief executive officer and chairman of ARCT IV said, “This well-constructed and highly diversified portfolio transaction with GE Capital enables us to efficiently deploy all of the remaining equity capital raised for American Realty Capital Trust IV within the next 60 days, well ahead of schedule. This high quality retail property portfolio represents a unique opportunity for the Company. We are very pleased to buy this collection of long-duration strongly branded retail assets at a cap rate north of 7%. This acquisition exemplifies our focus on building one of the best-in-class, lowest leveraged, long-term, retail focused net lease portfolios in the REIT industry’s history. The completion of our acquisition program positions us to commence our active review of strategic alternatives in a market that has proven extremely supportive to net lease companies.”

To read the full news release click here.

Previously on abfjournal.com:

GE Capital Sheds Franchise Related Assets, Monday, June 03, 2013