Completes First Quarter Investment Volume of $275 Million
Provides Updates on Hellweg, True Value and Hearthside and Affirms 2025 AFFO Guidance
Recasts Existing €500 Million Term Loan Extending Maturity to 2029
NEW YORK, April 1, 2025 /PRNewswire/ -- W. P. Carey Inc. (NYSE: WPC) (W. P. Carey or the Company), a leading net lease REIT specializing in corporate sale-leasebacks, build-to-suits and the acquisition of single-tenant net lease properties, today provided the following business update and affirmed its full-year 2025 AFFO guidance.
Investments
During the 2025 first quarter, W. P. Carey completed investments totaling approximately $275 million, primarily comprising sale-leasebacks of industrial properties. In addition, the Company currently has capital investments and commitments totaling approximately $120 million scheduled to be completed during 2025.
For the 2025 full year, the Company continues to expect investment volume totaling between $1.0 billion and $1.5 billion.
Dispositions
During the 2025 first quarter, W. P. Carey completed dispositions with gross proceeds totaling approximately $130 million.
For the 2025 full year, the Company continues to expect to fund new investments with gross disposition proceeds totaling between $500 million and $1.0 billion, the majority of which is expected to comprise accretive non-core asset sales, primarily of self-storage operating properties.
Tenant Credit
The Company is providing the following updates on three of its top 25 tenants and continues to expect rent loss from tenant credit events to total between $15 million and $20 million for the 2025 full year.
Hellweg
- Hellweg remains current on rent, although it continues to face a challenging operating environment, including weak German consumer spending and a competitive German Do-It-Yourself industry. To support its ongoing turnaround, Hellweg is working to improve liquidity with its key stakeholders, including its landlords and lenders.
- W. P. Carey is working with Hellweg to take back 12 stores, representing 0.56% of total ABR1. Accordingly, the two parties executed an agreement to terminate leases on seven stores by September 2025, representing 0.33% of total ABR, and five stores by September 2026, representing 0.23% of total ABR.
- W. P. Carey is in active negotiations with other operators to lease eight of the stores at rents in line with their current rents. Leases with new tenants are expected to be signed in advance of the Hellweg termination dates, minimizing the impact on W. P. Carey's AFFO.
- Negotiations are ongoing to sell the four remaining stores.
- The total expected impact on lease revenues from downtime during the transition to new tenants and dispositions of vacant stores is embedded in the expected rent loss from tenant credit events affirmed above.
- W. P. Carey is in active negotiations with other operators to lease eight of the stores at rents in line with their current rents. Leases with new tenants are expected to be signed in advance of the Hellweg termination dates, minimizing the impact on W. P. Carey's AFFO.
- Separately, during the 2025 first quarter, W. P Carey completed the sale of one store and placed three additional stores under binding contracts to sell. In total, the four stores, which remain leased and occupied by Hellweg, represent 0.13% of total ABR.
- The re-leasing and sale of stores outlined above is expected to further reduce W. P. Carey's exposure to Hellweg, which is anticipated to rank below the Company's top 10 tenants (by ABR) by the end of 2025.
Do it Best (formerly True Value)
- On March 28, 2025, W. P. Carey executed lease amendments and assignments with Do it Best on five distribution facilities and one industrial facility at the existing rents, which together represent 1.05% of total ABR. The leases have staggered maturities, with a weighted-average term of approximately seven years. All other lease terms were unchanged.
- On June 30, 2025, Do it Best will vacate the remaining three assets, which represent 0.35% of total ABR. The properties are currently being marketed for sale with closings anticipated during the second half of 2025.
- The transaction with Do it Best remains subject to customary bankruptcy court approval.
Hearthside
- On March 31, 2025, Hearthside's Chapter 11 restructuring plan became effective under which W. P. Carey's leases were assumed at the existing rents and with no changes to their terms.
- Properties leased to Hearthside represent 1.29% of total ABR.
____ |
|
(1) |
Total ABR refers to total contractual minimum annualized base rent as of December 31, 2024. |
2025 AFFO Guidance Affirmed
For the 2025 full year, W. P. Carey affirms its expectation that it will report AFFO of between $4.82 and $4.92 per diluted share, based on the assumptions stated above for investment volume, disposition volume and expected rent loss from tenant credit events.
Euro-Denominated Term Loan
On March 31, 2025, W. P. Carey:
- Refinanced its existing €500 million term loan, extending its maturity three years to April 24, 2029, with options to extend up to an additional year at the Company's discretion, subject to the satisfaction of certain customary conditions.
- Executed a €500 million variable-to-fixed interest rate swap fixing one-month EURIBOR at 2.00% and resulting in an all-in annual rate of 2.80%.
In conjunction with the repayment of the $450 million senior unsecured notes that matured on February 1, 2025, the Company has now addressed approximately half of its debt maturing through the end of 2026.
W. P. Carey Inc.
W. P. Carey ranks among the largest net lease REITs with a well-diversified portfolio of high-quality, operationally critical commercial real estate, which includes 1,555 net lease properties covering approximately 176 million square feet and a portfolio of 78 self-storage operating properties as of December 31, 2024. With offices in New York, London, Amsterdam and Dallas, the Company remains focused on investing primarily in single-tenant, industrial, warehouse and retail properties located in the U.S. and Northern and Western Europe, under long-term net leases with built-in rent escalations.
www.wpcarey.com
Certain of the matters discussed in this communication constitute forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, both as amended by the Private Securities Litigation Reform Act of 1995. The forward-looking statements include, among other things, statements regarding the intent, belief or expectations of W. P. Carey and can be identified by the use of words such as "may," "will," "should," "would," "will be," "goals," "believe," "project," "expect," "anticipate," "intend," "estimate" "opportunities," "possibility," "strategy," "maintain" or the negative version of these words and other comparable terms. These statements are based on the current expectations of our management, and it is important to note that our actual results could be materially different from those projected in such forward-looking statements. There are a number of risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Other unknown or unpredictable risks or uncertainties, like the risks related to fluctuating interest rates, the impact of inflation on our tenants and us, the effects of pandemics and global outbreaks of contagious diseases, and domestic or geopolitical crises, such as terrorism, military conflict, war or the perception that hostilities may be imminent, political instability or civil unrest, or other conflict, and those additional risk factors discussed in reports that we have filed with the SEC, could also have material adverse effects on our future results, performance or achievements. Discussions of some of these other important factors and assumptions are contained in W. P. Carey's filings with the SEC and are available at the SEC's website at http://www.sec.gov, including Part I, Item 1A. Risk Factors in W. P. Carey's Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Investors are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this communication, unless noted otherwise. Except as required under the federal securities laws and the rules and regulations of the SEC, W. P. Carey does not undertake any obligation to release publicly any revisions to the forward-looking statements to reflect events or circumstances after the date of this communication or to reflect the occurrence of unanticipated events.
Institutional Investors:
Peter Sands
1 (212) 492-1110
institutionalir@wpcarey.com
Individual Investors:
W. P. Carey Inc.
1 (212) 492-8920
ir@wpcarey.com
Press Contact:
Anna McGrath
1 (212) 492-1166
amcgrath@wpcarey.com
View original content to download multimedia:https://www.prnewswire.com/news-releases/w-p-carey-provides-business-update-302416373.html
SOURCE W. P. Carey Inc.
