Carey Diversified Purchases Bellsouth Call Center in Lafayette, Louisiana
Transaction Structured as Stock-for-Property Swap
NEW YORK, NY – December 23, 1999 – Carey Diversified LLC (NYSE:CDC), a market leader in the ownership and net leasing of corporate properties, has announced the purchase of an office and call center facility leased to BellSouth Telecommunications, Inc. under a ten year, two month net lease. Total consideration for the purchase was approximately $8.5 million. The largest limited liability company traded on the New York Stock Exchange, Carey Diversified is a member of the $2.5 billion W. P. Carey group.
The acquisition was structured as a property-for-stock swap. The seller, the Cullen Family Trust, received as consideration for the property Carey Diversified stock. Simultaneously with the closing, a non-recourse loan in the amount of $6 million was placed on the property by Lehman Brothers though its credit tenant lease program. The acquisition will further enhance the diversification of Carey Diversified's portfolio both geographically and by property type and adds another highly rated credit to Carey Diversified's roster of prominent corporate tenants. The 67,300 square foot facility is located on a 4.9 acre site in Lafayette, Louisiana, one of the larger cities on the I-10 Corridor between New Orleans and Houston.
Commenting on the investment, Gordon F. DuGan, President of Carey Diversified, noted, "Our ability to structure the transaction as a stock-for-property swap allowed us to meet the specialized tax and investment planning needs of the seller. In addition the strength and quality of the existing Carey Diversified portfolio has been enhanced by the acquisition of a prime property leased to a Triple-A credit tenant."
BellSouth (NYSE:BLS) is an AAA-rated, $39 billion international communications company providing telecommunications, wireless communications, cable and digital TV, Internet and data services, as well as directory advertising and publishing in 19 countries worldwide. As BellSouth's largest subsidiary, BellSouth Telecommunications, Inc. serves residential and business customers in nine southern states including Louisiana, Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina and Tennessee.
Carey Diversified's First Vice President, Edward V. LaPuma, noted, "This transaction enabled the sellers to convert a single asset investment into an ownership in a high quality well diversified property portfolio through the receipt of shares in Carey Diversified. In addition to the portfolio diversity created for the sellers, they will also benefit from the liquidity offered by shares in Carey Diversified. Our ability to provide the benefits of stock-for-property swaps to potential sellers gives us access to investments that might not otherwise be available as well as offering sellers an attractive and efficient exit strategy."
Carey Diversified's portfolio consists of 210 properties in 37 states, totaling more than 20 million square feet. Carey Diversified leases properties to manufacturing, technology, retailing and communications companies including America West Airlines, Federal Express Corp., Detroit Diesel, Gibson Greetings, Inc., Dr Pepper Bottling Company of Texas, Wal-Mart, AT&T, The Gap and more than 70 others nationwide. Additional information about Carey Diversified LLC is available on the company's website at www.careydiv.com.
This press release contains forward-looking statements within the meaning of the Federal securities laws. A number of factors could cause the company's actual results, performance or achievement to differ materially from those anticipated. Among those risks, trends and uncertainties are the general economic climate; the supply of and demand for office and industrial properties; interest rate levels; the availability of financing; and other risks associated with the acquisition and ownership of properties, including risks that the tenants will not pay rent, or that costs may be greater than anticipated. For further information on factors that could impact the company, reference is made to the company's filings with the Securities and Exchange Commission.
