American Realty to Buy $100M of Surplus Branches from Wachovia
American Realty Capital II, an affiliate of American Realty Capital Trust, has entered into an agreement with Wachovia Bank N.A., to acquire the bank’s surplus branches nationwide on an exclusive basis. A prepared statement from American Realty Capital II stated that this year it anticipates purchasing more than 100 such branches with a total value…
American Realty Capital II, an affiliate of American Realty Capital Trust, has entered into an agreement with Wachovia Bank N.A., to acquire the bank’s surplus branches nationwide on an exclusive basis. A prepared statement from American Realty Capital II stated that this year it anticipates purchasing more than 100 such branches with a total value of more than $100 million. CFO Brian Block told CPN that this transaction is the first for ARC II, a holding/sponsor company that began operations just last August. The typical locations of the surplus Wachovia branches, he explained, are freestanding lots at major intersections or shopping center outlots. Each property’s value will be appraised on a property-by-property basis. In a prepared statement, Nicholas Schorsch, CEO of American Realty Capital and former CEO of American Financial Realty Trust, noted that the transaction “further strengthens” American Realty Capital’s “already dominant position in the bank branch real estate market.” CPN reported in December that Harleysville National Bank had closed on a $38.2 million sale-leaseback of 15 of its properties to American Realty Capital L.L.C. Under the agreement, the bank will continue to occupy and retain control of the properties for at least 15 years, with options to renew. With the Wachoiva agreement, American Realty Capital Trust steps into the shoes of American Financial Realty Trust, which previously had been slated to purchase surplus Wachovia branches. Schorsch was a founder and one-time CEO of AFR, and ARC co-founder William Kahane was formerly a board member of AFR. Both resigned from AFR in August 2006. AFR will reportedly be sold to Gramercy Capital Corp. later this month.American Realty Capital has also been busy setting up American Realty Capital Trust, a publicly held, non-traded REIT. A recent filing with the SEC stated that ARC Trust “intends to qualify as a real estate investment trust beginning with the taxable year that will end December 31, 2008.”
