Getty Realty & Applegreen Enter 42-Property Pact for $70M
JERICHO, N.Y. — Getty Realty Corp. is growing its portfolio to include 42 properties in Columbia, S.C.
According to Getty, the company signed definitive agreements for an acquisition leaseback transaction with a U.S. subsidiary of Applegreen plc. Under the terms of the transaction, Getty, through a subsidiary, will acquire interests in 38 fee simple and four leasehold properties for $70.1 million and simultaneously enter into a unitary lease with Applegreen covering all of the sites.
The transaction is expected to close before the end of the fourth quarter.
The properties consist of 34 convenience store and gas stations, many of which feature nationally recognized quick-service restaurants such as Burger King, Subway and Blimpie. The deal also includes eight stand-alone Burger King restaurants located within Columbia's metropolitan market.
The unitary lease — to be effective at closing — provides for an initial term of 15 years, with four, five-year renewal options. Rent is scheduled to increase annually during the initial and renewal terms of the lease.
Under the terms of the transaction, Getty will receive an initial annual rent of $5 million from the fee simple properties and a positive rent spread of $200,000 on the leasehold interests being acquired, the company said.
"This acquisition extends our reach into South Carolina, in the desirable and growing Columbia market, and further builds our presence in the Southeast. We are excited to enter into a long-term relationship with Applegreen, the largest convenience store and gasoline station operator in the Republic of Ireland," said Christopher J. Constant, Getty's president and CEO.
"This is a significant commitment by Applegreen to its U.S. expansion, and we are happy to be their partner in South Carolina. The properties we are acquiring are high-quality convenience stores and gasoline stations, many of which have significant co-branded fast-food offerings," he said.
The stand-alone Burger King restaurants represent an added opportunity for Getty to expand its retail portfolio, Constant added.
Last week, Applegreen plc, the convenience store banner of Petrogas Group Ltd., signed a $5.4-million deal to acquire the assets of The Brandi Group, operator of 42 Pitt Stop c-stores, as CSNews Online previously reported.
The Getty transaction is subject to numerous closing conditions, including the closing of a purchase agreement between Applegreen and Brandi.
Jericho-based Getty is a publicly-traded real estate investment trust specializing in the ownership, leasing and financing of convenience store and gasoline station properties. As of March 31, the company owned 736 properties and leased 87 properties from-third party landlords in 24 states across the United States and Washington, D.C.
Founded in 1992, Applegreen currently operates 232 convenience stores and gasoline stations in Ireland and the United Kingdom, and has 11 locations in the United States. In addition to Applegreen branded c-stores, the company also operates 49 Subway and 16 Burger King quick service restaurants.