American Realty Capital Trust IV to Acquire Broadly Diversified Portfolio of
986 Long Duration Net Lease Properties from GE Capital, Formerly owned by
Trustreet Properties, with an Average Portfolio Lease Duration of 10.6 Years
$1.45 Billion Acquisition Allows ARCT IV to Complete Remaining Capital
Deployment in Next 60 Days, Creating a Property Portfolio in Excess of $2.3
ARCT IV to Become One of the Strongest, Diversified, Long-Duration, Low
Leverage, Retail Focused Net Lease Companies in the Industry
NEW YORK, June 3, 2013
NEW YORK, June 3, 2013 /PRNewswire/ --American Realty Capital Trust IV, Inc.
("ARCT IV" or the "Company") announced today that 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 Inc. 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.
(Logo: http://photos.prnewswire.com/prnh/20120911/NY72526LOGO )
The Company 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 $318.0 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
commented, "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."
Details of the Completion of ARCT IV's Capital Deployment
Disciplined and Diversified Portfolio Construction. This portfolio acquisition
is consistent with ARCT IV's investment strategy of purchasing long-duration
diversified retail net lease assets. Following this acquisition and its full
capital deployment, ARCT IV's weighted average lease duration will be 11.9
years, and the Company's portfolio will be well-diversified along the retail,
office and distribution sectors. The Company will experience minimal lease
rollover and strong contractual rent growth.
High Portfolio Occupancy and Increased Diversity. Following completion of ARCT
IV's acquisition program for its initial $1.7 billion of equity raised, its
portfolio will be 100% occupied. ARCT IV's completed portfolio will include
300 distinct tenants located in 48 states. In its current portfolio and
pipeline (excluding the GE Capital transaction), ARCT IV's top ten tenants
comprise 82.5% of the Company's net operating income. Upon completion of the
GE Capital transaction, portfolio diversification will be improved and top ten
tenant concentration will be reduced to 39.5%.
Increased Size and Scale. Once its capital deployment is completed, the
Company's portfolio will include 1,326 properties, containing 15.2 million
rentable square feet. Once the GE Capital acquisition is closed, ARCT IV's
annualized rental income will more than double from approximately $71 million
to approximately $170 million.
One of the Lowest Leverage REITs. Upon completion of its initial acquisition
stage, the Company will be one of the lowest leveraged net lease REITs in the
industry, targeting a debt to enterprise value ratio in the mid-20% range.
ARCT IV is a publicly registered, non-traded real estate investment trust
("REIT") that qualified as a REIT for tax purposes for the taxable year ended
December 31, 2012. Additional information about ARCT IV can be found on its
website at www.arct-4.com.
The statements in this press release that are not historical facts may be
forward-looking statements. These forward-looking statements involve risks and
uncertainties that could cause the outcome to be materially different. In
addition, words such as "anticipate," "believe," "expect" and "intend"
indicate a forward-looking statement, although not all forward-looking
statements include these words.
SOURCE American Realty Capital Trust IV, Inc.
Contact: Anthony J. DeFazio, Diccicco Battista Communications,
email@example.com, 484-342-3600; or Brian S. Block, EVP & CFO, American
Realty Capital Trust IV, Inc., firstname.lastname@example.org, 212-415-6500
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