W. P. Carey Inc. Acquires $56 Million Schneider Electric USA Corporate Headquarters and Technology Center

NEW YORK, Oct. 10, 2014 /PRNewswire/ -- W. P. Carey Inc. (NYSE: WPC), a global net-lease REIT specializing in corporate sale-leaseback financing, build-to-suit construction financing and the acquisition of single-tenant net-lease properties, announced today that it has acquired a 235,943 square-foot office and R&D facility for approximately $56 million.  The facility, purchased from a joint venture between Leggat McCall Properties and Long Wharf Real Estate Partners, is located outside of Boston and leased to Schneider Electric USA, Inc. for a period of 15 years.

Key Facts

• High credit parent: Schneider Electric USA, Inc., a subsidiary of Schneider Electric S.A. (Schneider Electric), is the global specialist in energy management and efficiency technologies. Between energy generation and its usage, Schneider Electric provides technology and integrated solutions to optimize energy usage across multiple market segments including energy & infrastructure, industry, data centers, buildings and residential. The company offers a unique portfolio including electrical distribution, industrial automation, critical power & cooling, building management and security.
• Critical facility: The facility serves as one of Schneider Electric's five major R&D facilities—the only such facility in the U.S.—as well as the company's U.S. corporate headquarters.  Schneider Electric has relocated over 800 employees and made a significant contribution in tenant improvements to the facility, making this location its U.S. showpiece for energy management and product automation solutions and services.  The U.S. is the company's largest market, accounting for $6 billion of its $31 billion in annual revenue for the year ended 2013.
• Well-located LEED certified facility: The facility is a Class-A office building located in a six-building, 900,000 square-foot business park outside of Boston, with access to major highways.  Schneider Electric's own energy-efficient products and solutions have been incorporated into the facility's design in order to reduce energy use and operational costs by an estimated 30%.

Sustainability and efficiency highlights of the facility include:

• 40% water use reduction
• Use of low-emitting compounds in adhesives, paints, flooring and furniture systems to improve air quality
• A 600-ton chiller plant with economizer for free cooling
• Three energy recovery units for fresh air
• 95% efficient gas hot water boilers

Management Commentary

W. P. Carey Managing Director and Co-Head of Global Investments, Jason Fox commented: "This investment represented an opportunity to acquire a newly renovated Class-A, LEED certified facility that is critical to Schneider Electric's U.S. operations.  Working with an established local developer, W. P. Carey secured a solid income-generating asset for our owned real estate portfolio.  Because our strategy is to generate income and cash-flow over the longer term, we are an attractive source of liquidity for owners, developers and investors with shorter term investment horizons and the desire to recycle their capital."   

Commenting on the submarket where the facility is located, Mr. Fox added: "The asset is positioned in the Route 495 North East office submarket, which has witnessed tightening vacancy and positive net absorption in 10 of the past 12 quarters.  We have also seen significant momentum just south in the Burlington/Waltham areas, as market fundamentals continue to tighten north of Boston."

Leggat McCall Properties Commentary

Leggat McCall Properties Executive Vice President, Bill Gause added: "We have historically been thought leaders in the implementation of energy efficient and sustainable practices in our projects and continue to explore innovative new concepts incorporating renewable energy sources.  We are particularly pleased to complete this transaction with W. P. Carey given its long-term investing outlook and appreciation of energy efficiency." 

W. P. Carey Inc.

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Long Wharf Real Estate Partners LLC

Long Wharf Real Estate Partners is a Boston-based private equity real estate manager focused exclusively on value-added investments in the U.S. Investing on behalf of institutional clients including corporate and public pension funds, endowments, foundations, and family offices, Long Wharf utilizes a broad-based value-added strategy targeting opportunities in multiple property sectors and markets across the country.

This press release contains forward-looking statements within the meaning of the Federal securities laws.  The statements of Mr. Fox are examples of forward looking statements. A number of factors could cause W. P. Carey's actual results, performance or achievement to differ materially from those anticipated.  Among those risks, trends and uncertainties are the general economic climate; the supply of and demand for office and industrial properties; interest rate levels; the availability of financing; and other risks associated with the acquisition and ownership of properties, including risks that the tenants will not pay rent, or that costs may be greater than anticipated.  For further information on factors that could impact W. P. Carey's, reference is made to its filings with the Securities and Exchange Commission.

Company contact:
Kristina McMenamin 
W. P. Carey Inc. 
212-492-8995 
[email protected]

Press contact:
Guy Lawrence
Ross & Lawrence
212-308-3333 
[email protected]

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SOURCE W. P. Carey Inc.