REIT Watch: New Bid Could Delay Empire State Realty Trust IPO

on Jul 25, 2013

**United States**

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**New Bid Could Delay Empire State Realty Trust IPO** Thursday July 25th: Malkin Holdings has received an unsolicited $710 million (₤464 million) offer for One Grand Central Place – a 1.3 million sq. ft., 55-story building in Manhattan. The property is the second largest building in the proposed Empire State Realty Trust portfolio with the first spot taken by the iconic Empire State Building.

The Wall Street Journal quoted inside sources as saying that the offer was from Andrew Penson, a prominent New York real-estate investor whose company owns Grand Central Terminal. According to some securities attorneys Malkin Holdings was obliged to consider the offer, which could delay its plans to float the Empire State Realty Trust. “These offers certainly complicate things and could slow the process down a bit,” said Tom Murphy, head of capital markets for the international law firm McDermott

Will & Emery.
Based on a January 23, 2013 Securities and Exchange Commission S-4 statement, the offer for One Grand Central Place is almost $101 million (₤66 million) greater than the $609 million (₤398 million) “exchange value” of the building as part of the proposed initial public offering.
“We consider all matters, including unsolicited proposals, consistent with our fiduciary duties, to form a judgment on what action is appropriate,” Malkin Holdings last week wrote to its investors regarding the latest offer. “We do not intend to issue a comment until after our review.”

**Washington REIT Announces $0.30 Quarterly Dividend**
Washington REIT, a real estate investment trust with a portfolio of income-producing properties in the greater Washington metro area, announced today that it would distribute a quarterly dividend of $0.30. The payment will be made on September 30 to shareholders of record as of September 16.

**Crombie REIT to Pay C$990 Million for 68 Properties**
Crombie REIT, a real estate investment trust with a portfolio of retail, office and mixed-used properties in Canada, yesterday announced that it had entered into an agreement to acquire a portfolio of 68 retail properties. The portfolio’s gross leasable area is about three million sq. ft., which are fully occupied.
Crombie will acquire the portfolio with a price tag of C$990 million (₤628 million) from Empire Company, a wholly-owned subsidiary of Canada’s second-largest grocer Sobeys. The properties involved in the deal are located in British Columbia, Alberta, Saskatchewan and Manitoba.
!m[Crombie REIT to Pay C$990 Million for 68 Properties](/uploads/story/4343/thumbs/pic1_inline.jpg)
“The geographic location of these assets is highly complementary to our existing core portfolio, providing greater exposure to Western Canadian markets and solidifying Crombie’s position as a truly national retail landlord,” Crombie president and chief executive Donald Clow said in a statement. “Furthermore, this portfolio contains a significant number of assets that are located in key, highly sought-after urban locations that are difficult to acquire.”
Crombie intends to partially finance the acquisition by selling to a syndicate of underwriters C$225 million (₤143 million) in subscription receipts as well as $75 million (₤48 million) in extendible convertible
**Washington REIT’s share price was $27.70 as of 25.07.2013, 14.43 BST.**
**Crombie REIT’s share price was C$13.26 as of 25.07.2013, 14.43 BST.**


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