JERICHO, N.Y. -- Finally closing the book on its relationship with a bankrupt tenant, Getty Realty Corp. received the final payment from the Getty Petroleum Marketing Inc. (GPMI) estate.
During the quarter and year ended Dec. 31, 2015, the company received distributions from the GPMI bankruptcy estate of approximately $10.8 million and $18.2 million, respectively, on account of the company’s general unsecured claims, Getty Realty said.
“These amounts represent our final distributions from the marketing estate,” new Getty Realty CEO Christopher Constant said during the real-estate investment trust’s (REIT) fourth-quarter and year-end earnings call. “Marketing is now fully behind us, and we're focused solely on the future of the company.”
GPMI filed for bankruptcy on Dec. 5, 2011, a week after Getty Realty said that it was terminating GPMI's master lease for nonpayment of rent. GPMI said that it expected operations to continue as usual during the restructuring process. GPMI leased approximately 800 properties from Getty Realty.
In July 2013, GPMI reached a settlement to pay creditors $93 million, $32 million of which was earmarked for Getty Realty.
The company “significantly enhanced [its] portfolio in 2015,” Constant said. “We completed numerous transactions during the year which both increased the number of properties in our net leased portfolio by 16% and reduced our transitional properties which include those we're selling, releasing or redeveloping by 77%. These transactions represent significant accomplishments for our company and position us well for consistent growth. … As we move forward, we will look to build upon our steady growth and continue to enhance the quality of our net leased portfolio.”
Mark Olear, COO, said that Getty Realty acquired 80 properties for the year, most of which were related to the company’s 77-site portfolio transaction that it completed in the second quarter of the year.
Getty Realty acquired interests in 77 convenience stores it acquired from Pacific Convenience & Fuels LLC and simultaneously leased to United Oil, for approximately $214 million.
“Our portfolio acquisition is performing well and provides us with additional geographic reach into key markets in the West Coast and in Colorado,” he said. “On the disposition front, we completed 12 sales for $2.9 million in the aggregate during the quarter. For the year, we sold 84 properties for $25.1 million in the aggregate.”
During the fourth quarter, Getty Realty leased 46 properties and for the year, it leased a total of 58 properties.
“Our activity for the quarter included 42 properties in Connecticut and in Massachusetts which we had previously leased to NECG Holdings Corp., a lease which had been problematic for us for some time,” said Olear. “We now have higher quality tenants in these properties and from an economic perspective, the new leases are relatively cash flow neutral. With the completion of these leasing projects, we have completed the vast majority of the restructuring associated with the NECG lease.”
He concluded, “The cumulative result of our transaction and leasing activities is that we ended the year with 805 net leased properties and 46 transitional properties.”
Getty Realty reported net earnings for the quarter of $19.9 million, compared to a net loss of $3.1 million for the same quarter ended Dec. 31, 2014. The company reported net earnings for the year of $37.4 million, compared to net earnings of $23.4 million for the year ended Dec. 31, 2014.
Jericho, N.Y.-based Getty Realty is a leading publicly traded REIT specializing in ownership, leasing and financing of convenience-store and gas-station properties. The company owns and leases approximately 850 properties nationwide, operated under a variety of brands including Getty, BP, Exxon, Mobil, Shell, Chevron, Valero, Fina, Aloha, Conoco and 76. It owns the Getty trademark and trade name in connection with its real estate and petroleum marketing business.
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