JERICHO, N.Y. -- Getty Realty Corp. has closed on a previously announced acquisition leaseback transaction with Empire Petroleum Partners LLC. The company acquired fee-simple interests in 49 convenience-store and gas-station properties for $123 million and simultaneously leased them to Empire under a unitary lease.
The transaction facilitates Empire’s purchase of a portfolio of c-stores from Alimentation Couche-Tard Inc., Laval, Quebec. Couche-Tard’s Circle K Stores Inc. agreed in June to sell a portfolio of 71 properties to Empire to satisfy compliance with regulatory requirements associated with its acquisition of CST Brands Inc.
The properties are located primarily within metropolitan markets in Arizona, Colorado, Florida, Georgia, Louisiana, New Mexico and Texas. The unitary lease provides for an initial term of 15 years, with four five-year renewal options. Rent is scheduled to increase annually during the initial and renewal terms of the lease.
“We are delighted to have closed this accretive transaction and to add 49 high-quality properties to our convenience-store and gasoline-station net lease portfolio,” said Christopher Constant, Getty’s president and CEO. “In addition, we are excited to begin a long-term partnership with Empire, a strong national fuel distributor and convenience-store operator. This transaction demonstrates our ability to execute on our strategy of growing our portfolio in targeted markets in the United States.”
The company expects its transaction with Empire to be immediately accretive to net earnings. It funded the transaction through a combination of funds from its $104 million follow-on equity offering, which closed in July 2017, and funds available under its credit agreement.
Dallas-based Empire Petroleum Partners is a wholesale distributor of motor-fuels brands including BP, Chevron, CITGO, ExxonMobil, Gulf, Marathon, Phillips 66, Shell, Sunoco, Texaco and Valero. It distributes motor-fuel products to more than 1,500 gas stations and convenience stores in 29 states and Washington, D.C.
Getty Realty Corp., Jericho, N.Y., is a publicly traded real-estate investment trust (REIT) specializing in the ownership, leasing and financing of c-store and gas-station properties. As of June 30, 2017, it owned 739 properties and leased 86 properties from third-party landlords in 25 states and Washington, D.C.