Gramercy Closes on Two Industrial Deals

NEW YORK CITY-Gramercy Capital Corp. on Monday said it had closed on a pair of industrial acquisitions totaling $22.4 million. The first was an approximately 342,000-square-foot industrial property in the Dallas suburb of Garland, TX, for which GKK paid $10.70 million in an all-cash transaction. The building is 100% leased to a single tenant through 2032.

The second is a 101-dock door truck terminal on a 16.25-acre site located two miles from I-95 in East Brunswick, NJ. That trade, also all-cash, represented an $11.65-million purchase price. The terminal is 100% leased to a single tenant through 2019.

Last month, GKK said it's exiting the CRE finance business and will trade on the New York Stock Exchange as Gramercy Property Trust beginning April 15. On March 18, the company closed on its transfer of collateral management and sub-special servicing agreements for its three CDOs to CWCapital Investments LLC for approximately $9.9 million, while retaining the equity.

When the sale to CWCapital was announced on Jan. 31, GKK CEO Gordon DuGan called it “a significant milestone in the transformation of Gramercy into a pure-play equity REIT.” He added that the deal was expected to produce an increase in corporate liquidity as well as “a significant reduction in going-forward expenses and a simplification of the balance sheet. We are very well positioned to continue our focus on creating durable, high-quality income from net lease assets throughout the US.”

In a release announcing its quarterly and full-year 2012 results, GKK said its exit from the finance business marks “an important step for the company in achieving a number of important objectives.” They include: maximizing the value of the servicing business through the sale to a large servicing operation; simplifying the going-forward business and significantly reducing the ongoing management, general and administrative expenses; generating more than $50 million in liquidity previously invested in the CDO business; and providing for potential future proceeds through the retention of the equity in the three CDOs.