19 Nov 2015 07:00
Acquisition of full control of Central Park
Dublin, 19 November, 2015 | Green REIT Plc, ("Green REIT" or the "Company"), the Irish property investment company, today confirms that it has entered into a conditional contract with its joint venture partner to acquire full control of Central Park, increasing its ownership from fifty per cent to one hundred per cent. Completion of this acquisition is conditional on the approval of the Competition and Consumer Protection Commission in Ireland.
Transaction Summary
§ Purchase price of €155 million, or 2.7% higher than the 30 June 2015 valuation by JLL
§ Estimated all-in cost to Green REIT of €160 million
§ Cost to be debt funded through (1) the Company's revolving credit facility with Barclays Bank (€85 million) and (2) by Green REIT taking over the vendor's 50 per cent of the Bank of Ireland debt secured against the Central Park properties (€75 million)
§ Closing expected by mid-January 2016, subject only to the approval of the Competition and Consumer Protection Commission in Ireland
§ The purchase price reflects a value of €428 per square foot and an equivalent yield of 5.6% on the investment assets
Portfolio post Acquisition
§ Annual passing rent will increase by €7.2 million/14% to €58.9 million
§ Annual contracted rent will increase by €8.9 million/16% to €64.4 million
§ One Albert Quay in Cork, the acquisition of which will complete in Q1 2016, will increase annual contracted rent further by an estimated €4.1 million to €68.5 million
§ Percentage by value of assets in Dublin will be 96% (and post Cork acquisition 91%)
§ Sector split: Dublin Office 78%, Retail 17%, Industrial 1%, Other 4%
§ Portfolio Income Yield: 5.0%[1] (30 June 2015: 5.2%)
§ Investment Income Yield: 5.2%[1] (30 June 2015: 5.4%)
§ Portfolio WAULT[2] will be 5.4 years in January 2016, on closing, which would be 4.7 years at the same date with only 50% of Central Park
[1] Based on 30 June 2015 values other than Central Park, where 100% is assumed to be valued at €310 million
[2] Rent weighted average unexpired lease term
Balance Sheet Impact Post Acquisition
§ Portfolio value increases by 16% from €968 million at 30 June 2015 to €1.13 billion
§ Debt position summarized as follows:
| At 30 June 2015 | Post Acquisition |
Total Debt | €95m | €260m |
Total Gearing | 9.50% | 22.2% |
Weighted Average Cost of Debt | 2.8% | 2.6% |
Weighted Average Debt Maturity | 3.1 yrs | 2.8 yrs |
Interest Cover | 20 times | 9 times |
§ With regard to Block H in Central Park, which has been under construction since April 2015, the Company expects to deploy an additional €20 million of capital towards its completion, to cover 100% of the costs to complete the building, with 100% of the development profit to accrue to the Company. This additional €20 million will be funded from the Company's revolving credit facility with Barclays Bank
Pat Gunne, Chief Executive, Green Property REIT Ventures Limited, the Investment Manager, commented:
"We are delighted to acquire full control of Central Park, which is widely acknowledged as Ireland's premier business park. The development of Block H, totaling 147,000 square feet, is now well underway and the park is fully occupied following our latest lease deal to Sage for 45,000 square feet. We are excited to be delivering this building into the market in the early stages of the Dublin office development cycle, with estimated completion in December 2016. Our intention, on the back of this acquisition, is to sell a number of assets in 2016 in order to stay within our intended total gearing level of 25%."
ENDS
Contacts
Green Property REIT Ventures (Investment Manager to the Company)
Niall O'Buachalla
+353 (0) 1 2418400
FTI Consulting (IR and PR to the Company)
Dublin London
+353 (0) 1 6633686 +44 (0) 203 727 1000
Mark Kenny Giles Barrie
Jonathan Neilan Claire Turvey
Melanie Farrell
greenreit@fticonsulting.com
About Green REIT Plc
Green REIT Plc is an Irish Real Estate Investment Trust ("REIT") and is listed on the Irish and London Stock Exchanges. The Company was the first REIT established in Ireland following the introduction of REIT legislation by the Irish Government. The Company's stated strategy is to create a property portfolio consisting primarily of commercial property in Ireland to deliver income and capital growth through opportunistic investments, active property management and prudent use of debt finance. Please visit www.greenreitplc.com
Note on forward-looking information
This Announcement contains forward-looking statements, which are subject to risks and uncertainties because they relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. Such forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause the actual results, performance or achievements of the Company or the industry in which it operates, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The forward-looking statements referred to in this paragraph speak only as at the date of this Announcement. The Company will not undertake any obligation to release publicly any revision or updates to these forward-looking statements to reflect future events, circumstances, unanticipated events, new information or otherwise except as required by law or by any appropriate regulatory authority.