CenterPoint Sells 600 Acres for $91M

ELWOOD, IL-The Burlington Northern Santa Fe Railway Co. won’t be writing any more rent checks to Oak Brook, IL-based CenterPoint Properties Trust for the 600 acres of land leased here at the CenterPoint Intermodal Center. Private investors have bought the land for $91.1 million, with the deal staggered over the next five quarters.

The buyers assume the ground lease, which CenterPoint Properties Trust securitized in June. The 6.641% interest on the bonds sold by the REIT matches the railroad company’s $6.5-million-a-year payments on the ground lease. In addition to eliminating debt from CenterPoint’s balance sheet, the staggered sale allows the largest industrial property owner in the market to focus on reinvesting $18 million a quarter into 2004, rather than trying to put the entire $91.1 million to use now.

“The structure of this sale should allow CenterPoint to maximize reinvestment returns, key to realizing the full benefit of the $91.1 million lease securitization and sale,” says co-chairman and chief executive officer John S. Gates in a statement.