A Griffin Capital non-traded real estate investment trust (REIT) has acquired a portfolio of office properties creating a $3 billion office and industrial REIT.
Stockholders of non-traded Signature Office REIT, Inc., formerly known as Wells Core Office Income REIT, Inc., approved a merger into Griffin Essential Asset REIT, Inc. during a special meeting on June 9, 2015. The merger, originally announced on November 21, 2014, provides Signature stockholders with 2.04 shares of Griffin common stock for each share of Signature stock.
The Griffin REIT acquires 13 properties with 15 office buildings that as of March 31, 2015, were 97.5 percent leased. GCEAR will also refinance Signature’s debt of $159 million with its existing credit facility.
Kevin Shields, Griffin Capital’s chairman and chief executive officer commented on the merger, “We are excited to welcome the Signature stockholders to GCEAR. This high-quality diversified portfolio adds depth and breadth to GCEAR, which now has a total capitalization of approximately $3 billion. The additional scale provides us and our stockholders, including the former Signature stockholders, with greater potential to execute a value-enhancing liquidity event.”
Griffin Capital’s chief investment officer Michael J. Escalante added, “With this acquisition, we have added a number of properties that serve as business essential assets for tenants in complementary areas for our portfolio. These new properties include key regional and national operating facilities that we believe provide steady cash flow and greater geographic diversity.”
Signature raised gross equity proceeds of about $460.3 million from June 2010 through June 2013 and invested substantially all of the capital raised in real properties and related assets including business essential assets with tenants such as State Farm Mutual Auto Insurance Company, GE Oil & Gas, Inc., and Time Warner Cable Southeast, LLC, among others.
Griffin Capital Essential Asset REIT closed to new investors on April 22, 2014 after raising approximately $1.3 billion through a series of offerings begun in 2008. Its portfolio of office, warehouse, and manufacturing facilities consists of 56 properties in 18 states with a total acquisition value of $1.9 billion.
Combined, the two non-traded REITs create a portfolio of 70 properties across 20 states.
In an earlier statement, Frank Bishop, chairman of the board of directors of Signature, commented, “We are excited about the opportunity to merge our company with Griffin. We believe the combined company will be well-positioned for growth and the execution of a successful liquidity event in the future.”