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Gramercy Sells 2 UK Assets, 2016 Asset Sales Cross $1.5B
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Gramercy Property Trust declared the disposition of two UK properties for total proceeds of £21.0 million. The move comes as part of the company’s previously announced plan of disposing select non-core assets, subsequent to the merger with Chambers Street Properties.
These dispositions bring the company’s 2016 single and multi-tenant assets sold in the U.S. and Europe tally to over $1.5 billion. Further, the company has around $120 million of assets in the market for sale at present.
The properties disposed this time, include one wholly owned single-tenant office building in Coventry, UK and 80% stake sell in a single-tenant logistics building located in Rugby, UK. The company generated gross proceeds of £9.0 million from the Coventry office asset disposition, while the stake sell in the Rugby asset was made for pro rata gross proceeds of £12.0 million.
Moreover, there are two remaining warehouses in Gramercy’s UK joint venture with Goodman Holdings Jersey Trust that are presently being repositioned and are likely to be disposed of in the first half of 2017.
On the other hand, Gramercy remains focused on making strategic acquisitions. Recently, the company announced the acquisition of a 17-property core logistics portfolio for $521 million. This move comes as part of its effort to enhance its industrial portfolio, which now comprises around 70% of its total portfolio, up from 47% a year ago.
With this transaction, the company’s 2016 investment volume exceeded $1.3 billion, with an average initial cash cap rate of 6.9% and 9.9 years of weighted average remaining lease term, which looks promising.
Notably, amid an e-commerce boom, growth in industries and supply chain strategy transformations; demand for logistics infrastructure and efficient distribution networks has been rising. This, in turn, is creating scope for industrial REITs to flourish.
Amid this, Gramercy remains well poised to capitalize on this favorable trend. The company has significantly reinforced its industrial portfolio, which now comprises a greater part of the total portfolio. In addition, as part of its portfolio recycling plan, it has strategically lowered its exposure to office assets to around 25% from 48%, a year before.
Gramercy currently has a Zacks Rank #3 (Hold). Year to date, shares of Gramercy ascended 16.2% against the Zacks categorized REIT and Equity Trust – Other industry’s gain of 2.8%.
Mack-Cali’s 2016 FFO per share estimates ascended 1.4%, over the past 30 days, to $2.19. Also, its share price is up 22.7% year to date.
Prologis has exceeded estimates in each of the trailing four quarters, with an average beat of 3.15%. Moreover year to date, its share price is up 21.8%.
Seritage Growth Properties’ current-year FFO estimates inched up 0.9% to $2.34 per share, over the past 60 days. Further, its share price is up 5.6% year to date.
Note: All EPS numbers presented in this write up represent funds from operations (“FFO”) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
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Gramercy Sells 2 UK Assets, 2016 Asset Sales Cross $1.5B
Gramercy Property Trust declared the disposition of two UK properties for total proceeds of £21.0 million. The move comes as part of the company’s previously announced plan of disposing select non-core assets, subsequent to the merger with Chambers Street Properties.
These dispositions bring the company’s 2016 single and multi-tenant assets sold in the U.S. and Europe tally to over $1.5 billion. Further, the company has around $120 million of assets in the market for sale at present.
The properties disposed this time, include one wholly owned single-tenant office building in Coventry, UK and 80% stake sell in a single-tenant logistics building located in Rugby, UK. The company generated gross proceeds of £9.0 million from the Coventry office asset disposition, while the stake sell in the Rugby asset was made for pro rata gross proceeds of £12.0 million.
Moreover, there are two remaining warehouses in Gramercy’s UK joint venture with Goodman Holdings Jersey Trust that are presently being repositioned and are likely to be disposed of in the first half of 2017.
On the other hand, Gramercy remains focused on making strategic acquisitions. Recently, the company announced the acquisition of a 17-property core logistics portfolio for $521 million. This move comes as part of its effort to enhance its industrial portfolio, which now comprises around 70% of its total portfolio, up from 47% a year ago.
With this transaction, the company’s 2016 investment volume exceeded $1.3 billion, with an average initial cash cap rate of 6.9% and 9.9 years of weighted average remaining lease term, which looks promising.
Notably, amid an e-commerce boom, growth in industries and supply chain strategy transformations; demand for logistics infrastructure and efficient distribution networks has been rising. This, in turn, is creating scope for industrial REITs to flourish.
Amid this, Gramercy remains well poised to capitalize on this favorable trend. The company has significantly reinforced its industrial portfolio, which now comprises a greater part of the total portfolio. In addition, as part of its portfolio recycling plan, it has strategically lowered its exposure to office assets to around 25% from 48%, a year before.
Gramercy currently has a Zacks Rank #3 (Hold). Year to date, shares of Gramercy ascended 16.2% against the Zacks categorized REIT and Equity Trust – Other industry’s gain of 2.8%.
Other better-ranked stocks in the real estate space include Mack-Cali Realty Corp. , Prologis, Inc. (PLD - Free Report) and Seritage Growth Properties (SRG - Free Report) . All these stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Mack-Cali’s 2016 FFO per share estimates ascended 1.4%, over the past 30 days, to $2.19. Also, its share price is up 22.7% year to date.
Prologis has exceeded estimates in each of the trailing four quarters, with an average beat of 3.15%. Moreover year to date, its share price is up 21.8%.
Seritage Growth Properties’ current-year FFO estimates inched up 0.9% to $2.34 per share, over the past 60 days. Further, its share price is up 5.6% year to date.
Note: All EPS numbers presented in this write up represent funds from operations (“FFO”) per share. FFO, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.
Zacks’ Best Private Investment Ideas
In addition to the recommendations that are available to the public on our website, how would you like to follow all Zacks' private buys and sells in real time?
Our experts cover all kinds of trades… from value to momentum . . . from stocks under $10 to ETF and option moves . . . from stocks that corporate insiders are buying up to companies that are about to report positive earnings surprises. You can even look inside exclusive portfolios that are normally closed to new investors. Starting today, for the next month, you can have unrestricted access. Click here for Zacks' private trades >>