G&E To Become Largest TIC Sponsor

Santa Ana, CA —When its merger with NNN Realty Advisors Inc . is complete, Grubb & Ellis Co .–a major Chicago-based commercial real estate brokerage, property management and advisory services firm–will by default become the biggest TIC sponsor in the nation. The combination will create a publicly traded company with a total capitalization of approximately $725 million, more than half of which will be accounted for by the NNN Realty side.

When the all-stock transaction is complete and NNN Realty shareholders have received .88 of a Grubb & Ellis share in exchange for each NNN Realty share, they will account for about 59% of the company’s ownership. The deal not only adds to the existing Grubb & Ellis operation, NNN’s: Triple Net Properties LLC (its TIC, REIT and fund investment sponsor platform), Triple Net Properties Realty Inc. (its property brokerage entity) and NNN Capital Corp. (its broker-dealer), it also will put NNN leadership decidedly at the helm of the new company.

As part of the transaction, announced last month and expected to close in the third or fourth quarter, Scott Peters, NNN Realty president and CEO, will become CEO of Grubb & Ellis, replacing current CEO Mark Rose. Anthony W. Thompson, the founder and chairman of NNN Realty, will become chairman of the Grubb & Ellis board, replacing current chairman C. Michael Kojaian, who will remain as a board member. The board will be expanded to nine members, including six nominees from NNN Realty. The company will continue to operate under the Grubb & Ellis name and trade on its NYSE ticker, but will move its headquarters to NNN Realty’s Santa Ana, CA offices.