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Thursday, 21 May 2020

VEREIT So Far Collects 78 Percent of May Rents, Provides Deferrals to 11 Percent of Rent Roll

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Commercial Real Estate Direct Staff Report

VEREIT Inc., which owns 3,853 properties with 89.5 million square feet that are net-leased to their tenants, through last Friday had collected 78 percent of the rent it was owed this month.

The Phoenix REIT expects its final May collections will be about the same as last month, when it collected 81 percent of rents due.

The bulk of its portfolio is comprised of retail properties, many of which are leased to operators of casual dining and quick-service restaurants. It generates 65.2 percent of its $1.1 billion of annualized rental income from retail tenants, 16.6 percent from its industrial tenants and 18.1 percent from its office tenants.

It so far has collected only 47 percent of rents due this month from its restaurant tenants, 78 percent from its other retail tenants, 91 percent from its industrial tenants and 96 percent from its office tenants.

In April, VEREIT collected 46 percent of the rents due from restaurants, 83 percent from other retailers, 98 percent from its industrial tenants and 97 percent from office tenants.

The company so far has received requests for rent deferrals from tenants accounting for 34 percent of its rental income and has approved one-third of them. Those requests typically involve the deferral of rent for two to four months and the repayment of deferred amounts, plus interest within the following 12 months. It's denied another one-third of the requests and is in talks to defer rents for the final third of its requests.

The REIT noted that 16 of its largest 20 tenants, which account for 38.2 percent of its rental income, have paid their May rent. Last month, 17 of those tenants paid rent. Its three largest tenants are Red Lobster, with 4.6 percent of its rental income; Dollar Tree, with 3.6 percent; and Dollar General, with 3.2 percent.

VEREIT has $601.4 million of cash as well as $588 million available under a credit facility. It also has $6.4 billion of debt, including $1.4 billion of mortgages. The REIT has an $89.6 million mortgage due this year as well as $321.8 million of convertible debt that matures in December.

During the first quarter, VEREIT acquired 25 properties for $146.2 million and sold 33 properties for $133 million. But Tom Roberts, VEREIT's chief investment officer, told analysts on a conference call yesterday that most transactions have been on hold since mid-March due to the coronavirus pandemic. Still, he expects a venture of VEREIT and Korea Investment & Securities Co. to complete the $247 million purchase of a 2.3 million-sf industrial portfolio this summer. The venture had signed a contract to acquire the properties before the pandemic hit.

Comments? E-mail Tim Casey or call him at (267) 397-3347.



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Additional Info

  • Syndicate to Realpoint: No
  • Sector: Multifamily
  • Subject: Leases (LSE), Mortgages/Financing (MOR), REITS -general (REITS)
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Read 414 times Last modified on Friday, 22 May 2020

Data Digest

 

CMBS DELINQUENCY VOLUME

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CMBS SPECIAL SERVICING VOLUME

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Top Bookrunners Domestic, Private-Label CMBS - 2017
Investment Bank #Deals Vol$mln MktShr%
Goldman Sachs 17.59 11,819.34 13.68
JPMorgan Securities 14.52 10,968.11 12.70
Citigroup 12.04 10,012.71 11.59
Wells Fargo Securities 14.02 9,936.06 11.50
Deutsche Bank 12.55 9,879.74 11.44

 

RCA CPPI

 

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CMBS 2.0 Spreads

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Top CMBS Loan Contributors - 2017
Lender #Loans Vol$mln MktShr%
Goldman Sachs 146.89 11,719.34 13.63
JPMorgan Chase Bank 117.68 10,114.14 11.76
Deutsche Bank 198.48 9,689.97 11.27
Morgan Stanley 166.18 8,539.78 9.93
Citigroup 199.05 8,088.24 9.41

 

 

 

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