REIT Buys 574,000-SF Warehouse Via $15M Loan

SALT LAKE CITY-American Realty Capital Trust has acquired a 574,106-square-foot distribution facility leased to health and personal care products company Reckitt Benckiser with a $15 million loan arranged by Broad Street Advisors of New York City. The property is at 3226 Sheep Lane North in the Salt Lake City suburb of Tooele and was built in 2009.

Reckitt Benckiser, a UK-based company, is leasing the building for 12 years, according to Keith Broemmer and Rob Rizzi, managing partners at Broad Street, who arranged the financing, which is a seven-year loan amortizing over 30 years. Broemmer and Rizzi say the interest rate is "very competitive" and note that the loan was arranged quickly. The lender is a regional bank based in the Southwest.

New York City-based American Realty, a nontraded REIT, acquired the property from an affiliate of San Antonio-based USAA Real Estate Co. The sale, terms of which were not disclosed, was brokered by the Sacramento, CA-based Palmer Team.

Broemmer and Rizzi note that American Realty has acquired nearly $380million worth of freestanding, single-tenant, net-leased assets to date. Broemmer comments, "We continue to see encouraging improvement in the capital markets.” Rizzi adds that the transaction is the third between affiliates of American Realty Capital Trust and USAA Real Estate, a relationship that Broad Street Advisors originated.

In the two previous deals between American Realty and USAA, both announced in December last year, American Realty acquired a leasehold interest in a 465,600-square-foot build-to-suit Home Depot distribution facility in Topeka, KS and acquired a Home Depot distribution facility in Columbia, SC that is also 465,000 square feet. The purchase prices were approximately $23.5 million for the Kansas deal and $25.9 million for the South Carolina property, according to public filings by American Realty and news releases from USAA Real Estate.

The Kansas distribution center and the South Carolina facility are both leased to Home Depot for 20-year terms. Financing for the Kansas acquisition included a four-year non-recourse, fixed-rate first mortgage of approximately $13.7 million. The first three years of the loan are fixed at 6.25%, and the loan includes a one-year extension option at an interest rate of 6.5%. Financing details for the South Carolina deal were unavailable.