Item
2.01 Completion of Acquisition of Assets
On August
6, 2010, American Realty Capital Trust, Inc. (the “Company”) executed a purchase
and sale agreement with the California State Automobile Association (the “CSAA”)
to acquire a portfolio of 11 free standing, fee simple properties (the “CSAA
Portfolio”).
The CSAA
Portfolio consists of the following properties: (i) five properties
for Walgreens Co. (“Walgreens”); (ii) two properties for Fifth Third Bank
(“Fifth Third”); (iii) two properties for Chase Bank; (iv) one property for CVS
Pharmacy (“CVS”); and (v) one property for Home Depot USA, Inc.
As of the
date of this Current Report on Form 8-K, the Company has closed the acquisitions
of eight of the eleven properties in the CSAA Portfolio. The aggregate purchase
price for the eight properties was approximately $38.5 million. The Company
funded the acquisitions of the properties with net proceeds received from the
sale of its common stock. As of August 11, 2010, we had raised approximately
$299,177,033 total gross proceeds in connection with our initial public
offering. A description of the acquired properties is set forth
below.
Walgreens
Portfolio
On August
6, 2010, the Company acquired five build-to-suit, freestanding, fee-simple
pharmacies for Walgreens located in Austin, Texas, Chelsea, Alabama, Joliet,
Illinois, Marysville, Ohio and Upper Arlington, Ohio from CSAA for a purchase
price of approximatley $27.4 million. The properties contain 84,609
square feet of gross leaseable area. The Company previously purchased
three Walgreens pharmacies located in Byram, Mississippi, LeRoy, New York and
Sealey, Texas.
The
original lease terms at commencement were 25 years with an average of 22.5 years
currently remaining. The leases do not contain rental escalations
during the primary term, consistent with all newer Walgreen
leases. The leases are triple net whereby Walgreens is required
to pay substantially all operating expenses, including all costs to maintain and
repair the roof and structure of the building, and the cost of all capital
expenditures, in addition to base rent. The average annual base rent
for the initial term is approximately $2.0 million.
Walgreen
Co. (NYSE: WAG) operates a chain of drugstores in the United States. The
drugstores sell prescription and non-prescription drugs, and general
merchandise. Its general merchandise comprises household items, personal care,
convenience foods, beauty care, photofinishing, candy, and seasonal items. The
company provides its services through drugstore counters, as well as through
mail, telephone, and the Internet. As of August 31, 2009, Walgreen operated
7,496 locations comprising 6,997 drugstores, 377 worksite facilities, 105 home
care facilities, 15 specialty pharmacies, and 2 mail service facilities in 50
states, the District of Columbia, Puerto Rico, and Guam. It also owned 33 strip
shopping malls. The company was founded in 1901 and is based in Deerfield,
Illinois
Fifth
Third Bank Portfolio
On August 6, 2010, the Company acquired
two build-to-suit, free standing, fee simple bank branches for Fifth Third
located in Montgomery, Illinois and Schaumburg, Illinois for a purchase price of
approximately $6.2 million. The properties contain 8,252 square feet
of gross leaseable area.
The
original lease terms at commencement were 20 years with an average of 17.6 years
currently remaining. The leases contain rent escalations of 10% every
five years. The leases are triple net whereby Fifth Third is
required to pay substantially all operating expenses, including all costs to
maintain and repair the roof and structure of the building, and the cost of all
capital expenditures, in addition to base rent. The average annual
base rent for the initial term is approximately $0.5 million.
Fifth
Third Bank is a U.S. regional banking corporation, headquartered in Cincinnati,
Ohio and is the principal subsidiary of holding company Fifth Third Bancorp
(NASDAQ: FITB). Fifth Third Bancorp operates as a diversified
financial services holding company. The company engages in five main lending and
banking practices: branch banking; consumer lending; commercial banking and
investment advisor services. As of December 31, 2009, the company
operated 1,309 full-service banking centers, including 103 Bank Mart locations
and 2,358 Jeanie ATMs in Ohio, Kentucky, Indiana, Michigan, Illinois, Florida,
Tennessee, North Carolina, West Virginia, Pennsylvania, Missouri, and Georgia.
The company was founded in 1862 and is headquartered in Cincinnati,
Ohio.
CVS
Pharmacy
On August 6, 2010, the Company acquired
a build-to-suit, free standing, fee simple retail store for CVS located in
Decatur, Georgia for a purchase price of approximately $5.0
million. The property contains 13,137 square feet of gross leaseable
area. This acquisition increases the size of the
Company’s existing portfolio of CVS retail stores from 25 to 26.
The
original lease term at commencement was 25 years with 22.5 years currently
remaining. The lease does not contain rent
escalations. The lease is triple net whereby CVS is required to pay
substantially all operating expenses, including all costs to maintain and repair
the roof and structure of the building, and the cost of all capital
expenditures, in addition to base rent. The average annual base rent
for the initial term is approximately $0.4 million.
CVS
Caremark Corporation (NYSE: CVS) operates as a pharmacy services company in the
United States. The company operates in two segments: pharmacy services and
retail pharmacy. The pharmacy service segment provides a range of
prescription benefit management services, including mail order pharmacy
services, specialty pharmacy services, plan design and administration, formulary
management, and claims processing. As of December 31, 2009, the
pharmacy service segment operated 49 retail specialty pharmacy stores, 18
specialty mail order pharmacies, and 6 mail service pharmacies located in 25
states, Puerto Rico, and the District of Columbia. The retail
pharmacy segment sells prescription drugs, over-the-counter drugs, beauty
products and cosmetics, photo finishing, seasonal merchandise, greeting cards,
and convenience foods through its pharmacy retail stores and
online. As of December 31, 2009, this segment operated 7,025 retail
drugstores located in 41 states and the District of Columbia; and 569 retail
health care clinics in 25 states. CVS Caremark Corporation was
founded in 1892 and is based in Woonsocket, Rhode Island.
Item
8.01 Other Events
On August
5, 2010, the Company filed a registration statement with the U.S. Securities
Exchange Commission to register $325 million of common stock for the follow on
offering to its initial public offering. The Company commenced its initial
public offering of $1.5 billion of common stock in January 2008. The initial
public offering was originally set to expire on January 25, 2011, three years
after its effective date. However, as permitted by Rule 415 of
the Securities Act, the Company will now continue its initial public offering
until the earlier of July 24, 2011, or the date that the SEC declares the
registration statement for the follow on offering effective.