Vereit Inc., the U.S. real estate company formerly known as American Realty Capital Properties Inc., intends to reduce its holdings by as much as $2.2 billion by the end of next year.
The real estate investment trust is seeking to cut its exposure to noncontrolled ventures, noncore assets, restaurants and buildings where leases have no short-term rent increases, according to a statement Thursday. Toward the total goal, about $960 million of sales have been completed this year or are under contract, the Phoenix-based company said.
The REIT has worked to rebuild its reputation after an accounting scandal last year that resulted in the departures of key executives, including Chairman Nicholas Schorsch and Chief Executive Officer David Kay. New board members were appointed and in March, Glenn Rufrano was hired as CEO. The company last week began trading under its new name, derived from the Latin word veritas, meaning “truth.”
Vereit currently owns more than 4,600 properties, most of which are leased to single tenants. The company grew rapidly through an acquisition spree, including the purchase of more than 500 Red Lobster restaurant locations last year.
Asset sales will likely include Red Lobster locations, Rufrano said in a conference call.
“We’re excited about our fresh start, and now off to execution,” Rufrano said on the call.
Vereit climbed 2.4 percent to $8.88 at 2:16 p.m. New York time. It earlier gained as much as 4.7 percent, the biggest intraday increase since March 2. The shares have lost more than a quarter of their value since the October disclosure of accounting errors.