Corporate Property Associates:18 – Global, a publicly registered non-traded real estate investment trust sponsored by W.P. Carey (NYSE: WPC), closed a $38.5 million acquisition of the mezzanine tranche for the financing of a portfolio of retail stores across Minnesota, Wisconsin and Iowa.
The tenant of the stores is Mills Fleet Farms, a full-service retail chain that has operated in the Midwest for more than 60 years. The loan is subordinate to a senior loan from Credit Suisse and Wells Fargo and is collateralized by a pledge of equity interests from the borrower. The initial term of the loan agreement is two years with three one-year extension options at the discretion of the borrower.
“This investment represented an opportunity to secure attractive returns collateralized by a portfolio of mission-critical real estate,” said Gino Sabatini, W. P. Carey managing director. “By diversifying CPA:18 – Global’s portfolio with a range of high-quality income-generating investments the transaction is consistent with our strategy of providing attractive, stable cash-flows backed by a combination of proven operating entities and solid real estate.”
CPA:18, which focuses on investing in income-producing commercial properties and real estate-related assets, went effective in May 2013 and closed in April 2015 after raising $1.3 billion in investor equity. The company’s portfolio consists of 134 properties with an investment cost of $2.1 billion, according to Summit Investment Research.