Hologic has signed a 20-year bond type net lease on the 207,000-sf class A headquarters building it occupies in Bedford and a 63,000-sf office, research and manufacturing property in Danbury. The Bedford facility houses Hologic's corporate, bone assessment, digital systems and mini-c-arm operations, whereas the company's Lorad mammography and breast biopsy unit is located in Danbury. Hologic acquired Lorad in September 2000 from Waltham, MA-based Thermo Electron Corp. in a $52-million deal.

W.P. Carey purchased the assets on behalf of Corporate Property Associates 15 Inc., the company's newest fund. "This transaction is another example of how a sale-leaseback can provide a company like Hologic with an alternative means of obtaining funds to pay down corporate debt," says Edward V. LaPuma, a Managing Director at W. P. Carey. "In today's tightening credit markets companies continue to realize the benefits of converting their bricks and mortar into working capital. This transaction provided us the opportunity to work with a talented management team, one we expect to develop a long-term relationship with in the years to come."

Hologic is using a portion of the sale proceeds to pay off its $25-million note payable from the Lorad acquisition. The transaction leaves less than $3 million of debt and roughly $40 million in cash on Hologic's balance sheet. Glenn Muir, Executive Vice President & Chief Financial Officer of Hologic, Inc. says the deal "essentially eliminates our long-term debt while reducing our overall expenses and also provides us with net cash proceeds after transaction costs of approximately $5 million.

"This sale-leaseback monetized our real estate assets acquired through the expansion and acquisition of Lorad, and allowed us to repay the $25 million note to Thermo Electron a year early," Muir notes. "This will save us approximately $300,000 a year as the new rental expense of $3.2 million will be more than offset by the elimination of the interest expense on the note and the depreciation on the buildings."

Real estate investment banking firm W.P. Carey, based here, owns and/or manages more than 400 commercial and industrial properties throughout the US and Europe comprising roughly 60 million sf.

For the first six months of 2002, the firm completed $285 million in acquisitions, compared with $118 for the same period last year, and W.P. Carey officials say they expect the company to set all-time acquisition volume records this year. This quarter, the company has already completed $147 million in acquisitions, already outstripping the Q3 2001 volume of $102 million.

Recent W.P. Carey sale/leaseback acquisitions include a 1.9-million sf industrial portfolio from Grand Rapids, MI-based Tower Automotive, Inc. for $55.7 million; the 192,000-sf Atlanta headquarters of Advantis Technologies, Inc. for $13.1-million; and a three-property deal with Katun Corp. for two US assets and one in the Netherlands that added 467,000 sf to W.P. Carey's holdings.

CPA 15 invests in single-tenant commercial properties, typically purchased under long-term, triple-net leases. The fund, launched in November 2001, currently has ownership interest in 28 properties net leased to nine tenants.

Instant Insights /

$32M W.P. Carey Sale/Leaseback Deal Totals 270,000 SF

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