Commercial - 2. August 2022
W. P. Carey Announces €64 Million Follow-on Investment with Coop Danmark A/S
W. P. Carey Inc. (NYSE: WPC), a leading net lease REIT specialising in corporate sale-leasebacks, build-to-suits and the acquisition of single-tenant net lease properties, is pleased to announce the sale-leaseback of 16 grocery stores, net leased to leading Danish food retailer, Coop Danmark A/S (“Coop”). The two transactions of approximately €40 million and €24 million closed in June and August, respectively, and include a commitment by W. P. Carey to acquire seven additional stores by the end of 2022, once refurbishments are completed.
Karolis Adlis, Executive Director, Investments, W. P. Carey said: “We’re delighted to extend our partnership with Coop and add 16 high-quality assets to our portfolio. Coop is an established player that has seen tremendous growth as the grocery retail sector in Denmark has expanded. Denmark remains an important market for us along with the rest of the Nordics in which we have invested over €900 million since our first transaction in 2001. We look forward to continuing our relationship with Coop moving forward.”
Flemming Møller Hansen, Real Estate Director at Coop Danmark, said: “We are thrilled to partner with W. P. Carey once again. This deal is demonstrative of the trust it has in our business model and will help to facilitate our national expansion strategy.”
Helle Nielsen Ziersen, Head of EDC International Poul Erik Bech, advisor to W. P. Carey, said: “It is always a pleasure to advise W. P. Carey, and this case was no exception. Tapping into their deep sector knowledge, fundamental understanding of the market and thorough professionalism, the team at W. P. Carey remain a great partner for corporates looking to realise the value of their real estate. The deal is reflective of the strong partnership built between Coop, W. P. Carey and EDC from prior successful transactions, and we look forward to this continuing over the long term.”
- Market-leading tenant: With a history dating back to 1866, Coop is one of Denmark’s leading grocery retailers with a market share of over 30%. Coop has a well-diversified portfolio of brands accommodating all grocery retail sectors including, discount, supermarket, hypermarket and premium. The company has continued to evolve alongside the growth of e-commerce through innovation and significant investment in technology, including its Coop app and two online businesses: Coop.dk MAD and Coop.dk Shopping.
- Attractive retail locations: The portfolio comprises established food retail properties located in dense urban locations. Strict Danish planning laws and licensing requirements make opening new retail stores difficult, thereby providing inherent value to established food retail sites.
- Defensive industry: Proximity food retailers have benefited from increased consumer interest in at-home cooking, a trend accelerated by the COVID-19 pandemic, and discount retail in particular has been a growing sub-sector in Denmark, taking market share from other forms of retail.
- Strengthening relationship with tenant: The transaction follows two prior sale-leasebacks with Coop completed in December 2021 and February 2022. As a result, W. P. Carey will own 42 of Coop’s food retail stores by the end of 2022.
- Long-term leases with built-in rent growth: The newly acquired stores are net leased for a term of 15 years with Danish NPI-based rent increases.