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Oaktree Funds and National Financial Realty Acquire $240 Million, 40-Building Portfolio of Wells Fargo Bank Leased Properties

Monday, March 11, 2013 10:00 AM


An affiliate of Oaktree Capital Management, L.P. (“Oaktree”) in partnership with National Financial Realty, Inc. (“NFR”), a privately-held investment company based in Los Angeles, has acquired a portfolio of 40 office buildings for $240 million from First States Investors B, L.P. The acquisition of the 3.4 million-square-foot office portfolio, which is 90 percent leased to Wells Fargo Bank, establishes NFR as the largest privately-held investment firm focused on acquiring and operating properties leased to regulated financial institutions.

“This off-market acquisition, principally backed by 11 years of Wells Fargo credit, at a 50% discount to replacement cost, is another example of Oaktree’s commitment to relationship based transactions with well-positioned strategic operating partners like NFR, in addition to lenders and borrowers in need of capital solutions,” said John Brady, Managing Director and head of global real estate for Oaktree.

“Acquisition of this geographically diverse portfolio fits perfectly into NFR’s investment strategy to acquire excellent properties leased to leading financial institutions that offer reliable cash flow and significant potential for appreciation,” said Vincent E. Pellerito, President and CEO of NFR.

He notes that Wells Fargo has a credit rating of “AA” by Standard & Poors and “A1” by Moody’s. “We also appreciate this opportunity to expand our relationship with Wells Fargo beyond our current ownership of its operation and data center in Hillsborough, Oregon,” Pellerito added.

The 40 buildings are leased on a long-term basis to Wells Fargo and include mission critical operations facilities as well as branch offices in eight Eastern and Southeastern states: North Carolina, South Carolina, Virginia, Florida, New Jersey, Pennsylvania, Maryland and Georgia. North Carolina is home to the largest share of the portfolio with eight buildings totaling 1.2 million square feet including a 450,000-square-foot regional operation center in Raleigh and a total of 616,000 square feet in Winston-Salem. Second is Pennsylvania with five buildings that comprise 600,000 square feet, including an almost 500,000-square-foot regional operations center in Philadelphia.

NFR was formed in 2006 by Pellerito who has structured more than $2.2 billion in global commercial real estate transactions over the past 20 years. The company’s direct ownership and operating interests include 142 properties with over 8.1 million square feet throughout the United States.

Complete list of Oaktree/NFR acquired properties can be found here.

About Oaktree

Oaktree is a leading global investment management firm focused on alternative markets, with $77.1 billion in assets under management as of December 31, 2012. The firm emphasizes an opportunistic, value-oriented and risk-controlled approach to investments in distressed debt, corporate debt (including high yield debt and senior loans), control investing, convertible securities, real estate and listed equities. Headquartered in Los Angeles, the firm has over 700 employees and offices in 13 cities worldwide. For more information visit www.oaktreecapital.com.

About National Financial Realty

Based in Los Angeles, National Financial Realty is a privately-held investment firm capitalizing on commercial real estate market inefficiencies. NFR’s proven performance and proprietary relationships create extraordinary opportunities in special situations where rapid capital deployment, transaction size, complexity, or current market conditions may impede other investors. NFR executes timely investments, typically in off-market transactions with solid fundamentals, limited and controllable risk, predictable cash flow and significant potential for appreciation. For more information: www.nationalfr.com.

(Source: Business Wire )
(Source: Quotemedia)

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