W. P. Carey Inc. Announces $167 Million of Sale-Leaseback Transactions with Nord Anglia

Three for-profit school campuses subject to CPI-indexed long-term triple-net leases

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Apr 04, 2016, 06:00 ET

NEW YORK, April 4, 2016 /PRNewswire/ -- W. P. Carey Inc. (NYSE: WPC), a leading internally-managed net lease REIT specializing in corporate and build-to-suit financing, and the acquisition of single-tenant net lease properties worldwide, announced today that it has acquired a private preparatory school campus in Windermere, FL from Nord Anglia Education Inc. (NYSE: NORD), a global leader in premium school organizations, and has also entered into agreements for the acquisition of two additional school campuses in Coconut Creek, FL and Houston, TX by the end of the second quarter. The properties will be leased to affiliates of Nord Anglia Education Inc. for a period of 25 years. The purchase price for all three properties is expected to total approximately $167 million.

W. P. Carey Inc. announces $167 million of Sale-Leaseback Transactions with Nord Anglia

W. P. Carey has also agreed to provide up to an additional $128 million of build-to-suit financing over the next four years in order to fund expansion of the existing facilities.

The consummation of the two additional acquisitions and the build-to-suit financing is subject to the satisfaction of various closing conditions, and there can be no assurance that W. P. Carey will acquire the two additional properties or enter into the build-to-suit financing.

Key Facts

Industry-leading education company: Founded in 1972, Nord Anglia Education Inc. is a leading global operator of premium international schools with 42 schools located in China, Europe, the Middle East, Southeast Asia and North America. A publicly-listed company, Nord Anglia has a market capitalization of approximately $2.0 billion.
Well-maintained state-of-the-art facilities: The three properties comprise 50 buildings totaling 591,874 square feet on 131 acres. The state-of-the-art campuses house Pre-K through 12th Grade students who benefit from a wide range of amenities, including extensive athletic facilities.
Long-term net leases with built-in rent growth: The 25-year triple-net leases include annual uncapped CPI-indexed increases. As the build-to-suit expansions are completed, they will be combined with the existing facilities and subject to new 25-year annual uncapped CPI-indexed triple-net leases.

Management Commentary

Gino Sabatini, W. P. Carey's Managing Director and Head of Net Lease Investments, commented: "This series of transactions with Nord Anglia demonstrates how our ability to structure large complex transactions makes us an attractive alternative source of long-term capital for creditworthy growing companies. These acquisitions and build-to-suit expansions afford W. P. Carey the opportunity to invest in assets that are consistent with our established criteria, providing predictable cash flows, compelling returns and annual rent escalations. Coupled with the long-term leases and the financial strength of Nord Anglia, we believe that these acquisitions and build-to-suit expansions will be accretive and solid additions to the W. P. Carey portfolio."

Andrew Fitzmaurice, Chief Executive Officer of Nord Anglia added: "W. P. Carey's long history of providing sale-leaseback and build-to-suit financing solutions, combined with their ability to underwrite the value and growth potential of these schools, made them the ideal partner for the sale-leaseback of Windermere Preparatory School, North Broward Preparatory School and The Village School. We are looking forward to working together with W. P. Carey to further enhance all three schools over the coming years."

W. P. Carey Inc.
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This press release contains forward-looking statements within the meaning of the Federal securities laws. The comments of Mr. Sabatini and statements regarding the acquisition of two additional school campuses in Coconut Creek, FL and Houston, TX, the aggregate characteristics of the three properties or any build-to-suit financings 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 commercial 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, reference is made to its filings with the Securities and Exchange Commission.