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Cole Real Estate to merge into American Realty Capital affiliate

Deal creates the largest net lease REIT with an enterprise value of $21.5B

Mergers

REIT American Realty Capital Properties (ARCP) continued on its REIT-buying spree this week, with the firm agreeing to absorb Cole Real Estate Investments (COLE), creating one of the largest net lease REITs in the world.

The deal, which involves Cole merging into one of American Realty's subsidiaries, is expected to result in a firm with an enterprise value of $21.5 billion.

But the real gain is having such a large platform in the net-lease REIT space at a time when there is significant interest in this particular investment vehicle.

The transaction is priced at $11.2 billion. The deal is still subject to customer closing conditions, including stockholder votes at both companies.

ARCP obtained a $2.75 billion financing line from Barclays to fund the transaction, which is expected to close in the first half of the year.

The combination of the two REITs is expected to result in a portfolio with a total of 3,732 properties.

American Realty Capital’s buying spree includes a $2.2 billion transaction to buy CapLease as announced by HousingWire back in May.

Then, in July, American Realty Capital agreed to buy REIT American Realty Capital Trust IV in a deal valued at roughly $3.1 billion.

The transaction provided the firm with 2,579 single-tenant properties net leased to 470 tenants across 29 industries in 48 states.

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