NEW YORK--(BUSINESS WIRE)--Gramercy Property Trust (NYSE:GPT), a real estate investment trust, announced today that it has closed on the acquisition of a 17-property, 10.3 million square foot, Class A warehouse portfolio (the “Portfolio”) for $521 million. The Portfolio consists of 17 bulk warehouses located in key logistics markets throughout the United States. The Company assumed approximately $198 million of secured debt in connection with the acquisition with a weighted average interest rate of 4.1% and a weighted average maturity of 3.9 years. With this acquisition, the Company’s 2016 investment volume exceeds $1.3 billion at an average initial cash cap rate of 6.9% (7.5% straight-line cap rate) and 9.9 years of weighted average remaining lease term.
The Portfolio consists of 15 stabilized assets with a weighted average remaining lease term of 5.2 years, one value-add asset located in Fairfield, California with a short-term in-place lease and one value-add asset located in Southhaven, Mississippi (Memphis MSA) that is 53% leased to a single tenant through August 2021. The 15 stabilized assets total 9.3 million square feet, and are located in Atlanta, Charleston, Cincinnati, Dallas, Indianapolis, Jacksonville, Memphis, and Sacramento. The two value-add properties total approximately 980,900 square feet.
2017 cash NOI for the stabilized properties is expected to be approximately $30.3 million (6.7% initial cash cap rate; 7.0% annualized straight-line cap rate) with 5.2 years of weighted average remaining lease term. The two value add assets are currently 82% leased and are expected to generate cash NOI of $4.6 million upon stabilization. 12 of the 17 assets are single-tenant properties and five of the assets have two tenants.
Nicholas Pell, Chief Investment Officer of Gramercy Property Trust, stated, "We are thrilled to announce this portfolio acquisition, which we believe combines a very attractive yield with high quality assets and below market rents. The acquisition is a key building block in the execution of our portfolio recycling plan. Approximately 70% of the GPT portfolio is now industrial, compared to 47% industrial one year ago. We have also reduced office exposure from approximately 48% to approximately 25% and maintained a weighted average lease term of 7.6 years over that same period. We enter 2017 with a high-quality portfolio, tremendous financial flexibility and a market leading operating platform to meet future opportunities and challenges.”
A more detailed description of the transaction and the Company’s pro forma real estate portfolio is outlined in a presentation posted on www.gptreit.com.
About Gramercy Property Trust
Gramercy Property Trust is a leading global investor and asset manager of commercial real estate. The Company specializes in acquiring and managing single-tenant, net-leased industrial and office properties. The Company focuses on income producing properties leased to high quality tenants in major markets in the United States and Europe.
To review the Company’s latest news releases and other corporate documents, please visit the Company's website at www.gptreit.com or contact Investor Relations at 888-686-0112.
