American Realty Capital Properties expects to close on the acquisition of approximately 150 net lease properties in third quarter 2013, for $550 million, exclusive of closing costs.
These purchases put ARCP ahead of its targeted acquisition volume for the period.
The properties are 100% occupied, of which 65% are net leased to investment grade tenants (measured by rents), as determined by a major credit rating agency, including CVS Caremark, Dollar General, Family Dollar, Walgreens and Wells Fargo.
Purchased at a weighted average cap rate of approximately 7.8% (calculated by dividing annualized rental income on a straight-line basis plus operating expense reimbursement revenue, less property operating expenses, by base purchase price), the properties are subject to leases with a weighted average remaining duration of nearly 13 years.
“We continue to identify and acquire high quality net lease properties with strong corporate tenants, including a significant proportion of investment grade tenants, and long-term leases at attractive purchase prices,” said Michael Weil, ARCP’s president.
“These organic investments enable us to fine tune our portfolio diversification by tenant, industry, geography and lease duration, further mitigating risk and enhancing earnings. While maintaining a deliberate focus on the execution of these organic acquisitions, ARCP remains committed to the anticipated closing of its announced merger with CapLease, Inc. as soon as possible following the stockholder vote scheduled for September 10, 2013.”
He added that ARCP anticipates the finalization of the proxy for its acquisition of ARCT IV in the next several weeks, clearing the way for stockholders from both companies to cast their ballots on that pending merger.
“As previously announced, ARCP’s annualized dividend will increase immediately by $0.03 per share from $0.91 per share to $0.94 per share per annum upon closing the CapLease merger.”
“Completing the CapLease merger is a significant milestone for ARCP,” noted Nicholas S. Schorsch, ARCP’s chairman and Chief Executive Officer. “Not only do we project approximately 10% AFFO per share accretion as a result of the merger, we hope to augment our intellectual capital with the addition of Paul McDowell and his senior management team, who bring distinct build-to-suit development expertise.”