W.P. Carey to Buy Nontraded REIT in Stock Transaction

W.P. Carey Inc. (WPC), an owner of single-tenant buildings and sponsor of nonlisted real estate investment trusts, agreed to buy one of the companies it manages to expand its property holdings.

The stock purchase of Corporate Property Associates 16–Global Inc. values the nontraded REIT at $11.25 a share, New York-based W.P. Carey said today in a statement. CPA 16 had about 217 million shares outstanding at the end of the first quarter, according to a regulatory filing, putting the value of the deal at about $2.4 billion.

The planned purchase will expand W.P. Carey’s ownership of real estate leased to single tenants. At the end of March, CPA 16 owned or had an interest in 494 properties leased to 140 tenants, with an occupancy rate of 97.4 percent, according to a quarterly filing.

“In addition to providing liquidity to CPA 16–Global investors, it will significantly increase W.P. Carey’s asset base, with a portfolio that will further enhance our already broad diversification by tenant, property type and geography,” W.P. Carey Chief Executive Officer Trevor Bond said in the statement.

W.P. Carey will assume about $1.7 billion of the REIT’s debt, according to a presentation on its website.

CPA 16, formed in 2003, had a net asset value of $8.70 a share at the end of December, down from $9.10 at the end of 2011, according to a regulatory filing.

Shares of W.P. Carey have climbed 48 percent in the past year to $67.81.

To contact the reporter on this story: Brian Louis in Chicago at blouis1@bloomberg.net

To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net

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