Other than FFO being positive:
• 6 separate transactions under contract/letter
of intent totaling approximately $100 million –
average cap rate of 8.5% (GAAP) and aver
age lease term of more than 11 years
• Robust pipeline of 8 additional transactions totaling more than $300 million
That is 400 million of potential transactions. Assuming a 8% cap rate, an additional 32 mil NOI per year, or 8 mil per quarter :)
How in god's green earth are they going to purchase 300M of additional property with only $64M of remaining capacity? Even levered 1:1 that only comes to $130M....also you are not taking into account the mortgage expense that is going to come with financing these properties.
I'm really hoping ARCP see's GPT as a buyout tbh. Beyond the lines of credit and cash they have, they can borrow against assets, but they'll pay a buttload of interest for that minimalistic spread of 3-4%.... gotta hope for a buyout... After two quarters of no increase in NOI, im out.
I agree. There is a lot more to be done than just buying properties. There are still legacy GKK problems to take care of. Mainly the board issue but the Preferred dividend of 8.125% is really tough to swallow. Either the preferred will be converted to common stock or the preferred should be bought out. That isn't such a bad idea since buying the preferred would release about 175 million in equity and debt.