Publish Date : 09-Oct-2018
Global Net Lease, Inc. a real estate investment trust focused on the acquisition of industrial and office properties leased long-term to high quality corporate tenants in select markets in the United States and Europe, said it has closed on four properties in the third quarter 2018, representing 1.3 million square feet for $105.4 million. The properties are leased to a furniture manufacturer, NetScout Systems Texas, LLC, Rubbermaid Incorporated and FedEx Freight.
The four properties were purchased at a weighted average going-in capitalization rate1 of 7.16%, equating to a weighted-average GAAP capitalization rate2 of 7.68%, with a weighted-average remaining lease term3 of 13.8 years. GNL funded the transactions with borrowings under its revolving credit facility and cash on hand, which includes proceeds from a public offering of GNL's common stock completed in August 2018.
Through the end of Q3 2018, GNL's combined pipeline of closed and scheduled to close 2018 acquisitions have increased to $401 million. The company has closed on $266.4 million of acquisitions through the end of the third quarter, with an additional $134 million expected to close by the end of the fourth quarter.
Property and Tenant Summary
The first of the four properties acquired, which has not been previously announced as one of the Company's pending acquisitions, is a triple net leased 456,094 square foot corporate headquarters and manufacturing facility located in New York State. The contract purchase price was $19 million. The building is leased for 20 years to a furniture manufacturer which creates both commercial-grade workplace furniture and high-quality ready-to-assemble furniture for the home. The company carries a Moody's implied credit rating4 of "Ba1."
The second property is a newly constructed, Class A office building net leased to NetScout Systems Texas, LLC. The 145,000 square foot building, located in Allen, Texas, was acquired for $54 million. The building is leased for 12 years. Founded over 30 years ago, NetScout, the guarantor of the Class A office building lease, is a leading provider of application and network performance management products. NetScout has been in the network performance monitoring space for 30 years. The company offers solutions that enable enterprises, service providers, and government agencies to monitor, manage, and protect their network and applications. NetScout, the guarantor, has a Moody's implied credit rating of "Ba3."
The third property is a 668,592 square foot industrial facility acquired for $21.4 million and is triple net leased to Rubbermaid Incorporated. The building, located in Akron, Ohio, was purchased with a remaining lease term of 10 years. Rubbermaid was founded in 1968 and is a manufacturer of innovative, solution-based products for commercial and institutional markets worldwide. The guarantor, Newell Brands, is a worldwide provider of consumer and commercial products. Newell Brands has a Standard & Poor's investment grade credit rating of "BBB-" and a Moody's investment grade rating of "Baa3."
The fourth property is a newly constructed 28,911 square foot distribution facility, acquired for $11 million and double net leased to FedEx Freight. The building is located in Greenville, North Carolina. The lease term on the property is 15 years. FedEx Freight, a business segment and wholly owned subsidiary of FedEx Corporation, is a leading provider of less than truckload freight services. This business segment offers two reliable freight services including FedEx Freight Priority and FedEx Freight Economy. FedEx Corporation has an investment grade credit rating of "Baa2" and "BBB" from Moody's and S&P, respectively.
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