Posted on July 2, 2018
W. P. Carey Inc. (NYSE: WPC), a leading net lease REIT specializing in corporate sale-leaseback, build-to-suit financing and the acquisition of single-tenant net lease properties, today announced the acquisition of a mission-critical portfolio of 14 logistics assets and one corporate headquarters totaling 1,986,841 square feet (184,582 square meters) for approximately $188 million (DKK 1.2 billion). The portfolio is triple-net leased to Danske Fragtmænd A/S (“Danske Fragtmænd”), the market-leading Danish freight carrier. The acquisition was advised by EDC Erhverv Poul Erik Bech in an off-market transaction that allowed the seller to efficiently identify a qualified buyer and negotiate the transaction without marketing publicly.
Key Facts:
- Complements existing Nordic portfolio:This deal marks W. P. Carey’s first investment in Denmark and complements the firm’s existing Nordic portfolio. W. P. Carey has been investing in the Nordics since 2001 and has acquired approximately $1 billion (€800 million) of assets in the region, including assets in Finland, Sweden and Norway.
- Market leading tenant: With a history dating back more than 100 years, Danske Fragtmænd is the leading freight carrier for business-to-business freight solutions in Denmark. It holds a dominant market share of approximately 50% in its segment, twice the size of its nearest competitor, with approximately 40,000 customers and nine million annual consignments.
- Mission-critical assets: The portfolio represents approximately 90% of Danske Fragtmænd’s logistics footprint and consists of five regional distribution hubs, nine last-mile distribution facilities and its corporate headquarters. The assets cover Denmark’s main urban centres outside of Copenhagen, including key regional sites in Aarhus, Odense and Taulov. In aggregate, approximately 80% of the portfolio’s annual base rent is located in the top seven metropolitan areas of Denmark.
- Long-term net leases with built-in rent growth: Triple-net leases with annual rent escalations tied to Danish CPI and a remaining term of approximately 17.8 years.
Arvi A. I. Luoma, Head of European Investments, W. P. Carey, said: “Denmark’s industrial real estate market is acutely under-supplied, so acquiring a high-quality logistics portfolio leased to one of the country’s top logistics companies was a rare and compelling opportunity.”
“Recongnized as a well-capitalized and efficient all-equity purchaser of long-term leased high-quality assets, we have a history of providing capital to institutional investors seeking to refocus their portfolios. This transaction demonstrates how we can move quickly to execute on acquisitions that meet our investment criteria and, in particular, our appetite for mission-critical real estate.”
Gino Sabatini, Head of Investments, W. P. Carey, said: “Our 20-year track record of net lease investing in Europe positioned us to secure the Danske Fragtmænd portfolio in an off-market transaction. Our European investments are an important component of the diversification of W. P. Carey’s net lease portfolio, and this latest transaction reflects our continued ability to invest in Europe and identify long-term partners that are defined by the quality of their assets and operations.”
Jørn P. Skov, Chief Executive Officer, Danske Fragtmænd, said: “We are pleased to have W. P. Carey as our new landlord and long-term partner. We look forward to working together in the future as Danske Fragtmænd seeks to expand its market share across Denmark.”
Helle N. Ziersen, Senior Client Director, EDC Erhverv Poul Erik Bech, said: “It has been a great process finding this off-market commercial real estate portfolio for W. P. Carey, and helping them enter the Danish real estate investment market. We thank all parties for a professional process and it has been a pleasure working together with Arvi Luoma and his colleagues. We look forward to working with W. P. Carey in the future, finding more real estate investments.”
W. P. Carey Inc.
Celebrating its 45th anniversary, W. P. Carey (NYSE:WPC) ranks among the largest diversified net lease REITs with an enterprise value of over $10 billion and a portfolio of operationally-critical commercial real estate totaling 886 properties covering approximately 85 million square feet. For over four decades the Company has invested in high-quality single-tenant industrial, warehouse, office and retail properties subject to long-term leases with built-in rent escalators. Its portfolio is located primarily in North America and Northern and Western Europe and is well-diversified by tenant, property type, geographic location and tenant industry. www.wpcarey.com
