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Net Lease Office Properties Announces Sale of Office Property for $72 Million

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Net Lease Office Properties (NYSE: NLOP) has announced the sale of an office property leased to CVS Health for $71.5 million. The property, located in Scottsdale, AZ, spans 354,888 square feet and had an annual base rent of $4.25 million. Net proceeds were used to repay approximately $55 million on J.P. Morgan's senior secured mortgage and $8 million on its mezzanine loan. After the sale, NLOP's portfolio consists of 46 office properties, including 43 in the U.S. and 3 in Europe. The transaction has reduced NLOP's outstanding loan balances to approximately $74 million for the senior secured mortgage and $81 million for the mezzanine loan as of August 7, 2024.

Net Lease Office Properties (NYSE: NLOP) ha annunciato la vendita di un immobile per uffici affittato a CVS Health per 71,5 milioni di dollari. La proprietà, situata a Scottsdale, AZ, si estende per 354.888 piedi quadrati e aveva un canone base annuo di 4,25 milioni di dollari. I proventi netti sono stati utilizzati per rimborsare circa 55 milioni di dollari sul mutuo senior garantito di J.P. Morgan e 8 milioni di dollari sul prestito mezzanino. Dopo la vendita, il portafoglio di NLOP è composto da 46 proprietà per uffici, di cui 43 negli Stati Uniti e 3 in Europa. L'operazione ha ridotto i saldi dei prestiti non rimborsati di NLOP a circa 74 milioni di dollari per il mutuo senior garantito e 81 milioni di dollari per il prestito mezzanino a partire dal 7 agosto 2024.

Net Lease Office Properties (NYSE: NLOP) ha anunciado la venta de una propiedad de oficinas arrendada a CVS Health por 71,5 millones de dólares. La propiedad, ubicada en Scottsdale, AZ, abarca 354,888 pies cuadrados y tenía un alquiler base anual de 4,25 millones de dólares. Los ingresos netos se utilizaron para pagar aproximadamente 55 millones de dólares en la hipoteca senior garantizada de J.P. Morgan y 8 millones de dólares en su préstamo mezzanine. Después de la venta, la cartera de NLOP consiste en 46 propiedades de oficinas, incluyendo 43 en EE.UU. y 3 en Europa. La transacción ha reducido los saldos de préstamos pendientes de NLOP a aproximadamente 74 millones de dólares para la hipoteca senior garantizada y 81 millones de dólares para el préstamo mezzanine a partir del 7 de agosto de 2024.

넷 리스 오피스 프로퍼티스(뉴욕 증권 거래소: NLOP)는 CVS Health에 임대된 사무실 건물을 7천150만 달러에 판매했다고 발표했습니다. 이 건물은 애리조나주 스코츠데일에 위치하며 354,888제곱피트의 면적을 가지고 있으며 연간 기본 임대료는 425만 달러였습니다. 순수익금은 J.P. 모건의 담보가 있는 선순위 대출금을 약 5천500만 달러 상환하고 800만 달러의 메자닌 대출금을 상환하는 데 사용되었습니다. 판매 후 NLOP의 포트폴리오는 46개의 사무실 건물로 구성되어 있으며, 그 중 43개는 미국에, 3개는 유럽에 있습니다. 이 거래로 인해 NLOP의 미상환 대출 잔액은 2024년 8월 7일 기준으로 담보가 있는 선순위 모기지에 대해 약 7천400만 달러, 메자닌 대출에 대해 8천100만 달러로 줄어들었습니다.

Net Lease Office Properties (NYSE: NLOP) a annoncé la vente d'une propriété de bureau louée à CVS Health pour 71,5 millions de dollars. La propriété, située à Scottsdale, AZ, s'étend sur 354,888 pieds carrés et avait un loyer de base annuel de 4,25 millions de dollars. Le produit net a été utilisé pour rembourser environ 55 millions de dollars sur l'hypothèque senior sécurisée de J.P. Morgan et 8 millions de dollars sur son prêt mezzanine. Après la vente, le portefeuille de NLOP se compose de 46 propriétés de bureaux, dont 43 aux États-Unis et 3 en Europe. La transaction a réduit les soldes de prêts en cours de NLOP à environ 74 millions de dollars pour l'hypothèque senior sécurisée et 81 millions de dollars pour le prêt mezzanine au 7 août 2024.

Net Lease Office Properties (NYSE: NLOP) hat den Verkauf einer Büroimmobilie bekannt gegeben, die an CVS Health vermietet ist, für 71,5 Millionen Dollar. Die Immobilie befindet sich in Scottsdale, AZ, und hat eine Fläche von 354.888 Quadratfuß mit einer jährlichen Grundmiete von 4,25 Millionen Dollar. Die Erlöse wurden verwendet, um etwa 55 Millionen Dollar für die von J.P. Morgan gesicherte Hypothek und 8 Millionen Dollar für das Mezzanine-Darlehen zurückzuzahlen. Nach dem Verkauf umfasst das Portfolio von NLOP 46 Büroimmobilien, darunter 43 in den USA und 3 in Europa. Die Transaktion hat die ausstehenden Darlehenssalden von NLOP auf etwa 74 Millionen Dollar für die von J.P. Morgan gesicherte Hypothek und 81 Millionen Dollar für das Mezzanine-Darlehen zum 7. August 2024 reduziert.

Positive
  • Sale of office property for $71.5 million, generating significant cash
  • Reduction of debt by approximately $63 million
  • Maintained a portfolio of 46 high-quality office properties after the sale
Negative
  • Decrease in property portfolio size and potential rental income
  • Reduction in U.S. market presence with the sale of a large office property

Insights

The sale of this CVS-leased office property for $71.5 million is a significant transaction for NLOP. The deal's impact is twofold:

  • Debt Reduction: Using $63 million to pay down debt improves NLOP's balance sheet.
  • Portfolio Adjustment: Reducing from 47 to 46 properties slightly decreases diversification.

The $4.25 million Annual Base Rent loss might impact short-term cash flow. However, the 5.9% cap rate (ABR/Sale Price) suggests a fair market value. The transaction's strategic importance lies in strengthening NLOP's financial position, potentially improving its ability to navigate the challenging office real estate market.

This transaction offers valuable insights into the current office real estate market:

  • Single-tenant, net-leased properties remain attractive, especially with credit-worthy tenants like CVS.
  • The $201 per square foot sale price is notable for a suburban office property, indicating strong demand for well-located, quality assets.
  • NLOP's decision to sell suggests a strategic shift, possibly due to:
    • Capital recycling to focus on core markets or property types
    • Proactive management of tenant concentration risk

This sale could signal NLOP's adaptation to evolving market conditions, potentially positioning itself for future opportunities in a shifting office landscape.

NEW YORK, Aug. 8, 2024 /PRNewswire/ -- Net Lease Office Properties (NYSE: NLOP) today announced the sale of an office property leased to CVS Health Corporation ("CVS") for gross proceeds of $71.5 million.

Primary
Tenant

Primary
Tenant
Industry

Location

 

ABR
(at time
of sale)

Gross Sale
Proceeds

Square
Feet

NLOP
Collateral
Pool

CVS

Health Care
Services

9501 Shea
Boulevard,
Scottsdale, AZ

$4.25 million

$71.5 million

354,888

Included

Net proceeds after closing costs were used to repay approximately $55 million on J.P. Morgan's senior secured mortgage and approximately $8 million on its mezzanine loan, in accordance with terms of those facilities. In conjunction with approximately $4 million of funds from other sources, this resulted in outstanding balances of approximately $74 million and $81 million, respectively, as of August 7, 2024.

Following the sale, NLOP owned 46 office properties, comprising 43 properties in the U.S. and three properties in Europe.

Net Lease Office Properties

Net Lease Office Properties (NYSE: NLOP) is a publicly traded real estate investment trust that owns a portfolio of high-quality office properties primarily leased to corporate tenants on a single-tenant net lease basis. Tenants operate across a variety of industries and the vast majority of properties are located in the U.S., with the balance located in Europe.

www.nloproperties.com

Institutional Investors: 
1-212-492-1140
institutionalir@nloproperties.com

Individual Investors: 
1-844-NLO REIT (656-7348)
ir@nloproperties.com

Press Contact:
Anna McGrath
1-212-492-1166

Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/net-lease-office-properties-announces-sale-of-office-property-for-72-million-302217288.html

SOURCE Net Lease Office Properties

FAQ

What was the sale price of the CVS-leased office property sold by NLOP?

Net Lease Office Properties (NLOP) sold the CVS-leased office property for $71.5 million.

How did NLOP use the proceeds from the office property sale?

NLOP used the net proceeds to repay approximately $55 million on J.P. Morgan's senior secured mortgage and $8 million on its mezzanine loan.

How many properties does NLOP own after the sale announced on August 8, 2024?

After the sale, NLOP owned 46 office properties, comprising 43 properties in the U.S. and three properties in Europe.

What were NLOP's outstanding loan balances after the property sale?

As of August 7, 2024, NLOP's outstanding balances were approximately $74 million for the senior secured mortgage and $81 million for the mezzanine loan.

Net Lease Office Properties

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