When iHeartCommunications was looking for ways to cut its corporate overhead after a 2008 leveraged buyout of its predecessor, Clear Channel Communications, it turned to W. P. Carey to help with one drain on corporate cash needed for debt repayments.
In February, W. P. Carey, a global net lease REIT specializing in corporate sale-leaseback financing, build-to-suit financing and the acquisition of single-tenant net lease properties, acquired iHeartCommunications' corporate center in San Antonio, TX, and leased it back to the broadcasting and outdoor advertising giant for 20 years. W. P. Carey paid about $22 million for the property, which iHeartCommunications uses mainly for its IT and finance departments.
“Corporations are realizing that real estate is not part of their core business and their investors are not investing in them to get real estate-like returns,” says Jason Fox, managing director with Carey. “They're looking for them to operate their core competencies, their operating businesses.”
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