Mergers & Acquisitions

Par Pacific Enters Into Sale-Leaseback Deal

Transaction involves 22 c-store properties in Hawaii
Photograph: Shutterstock

HOUSTON — Par Pacific Holdings Inc. has entered into a purchase agreement with a subsidiary of Realty Income Corp., a publicly traded real estate investment trust (REIT) for a sale-leaseback transaction involving 22 convenience-store properties in Hawaii.

Houston-based Par Pacific will sell the properties to San Diego-based Realty Income for an aggregate cash purchase price of $116.1 million. Par Hawaii will enter into a master lease agreement with Realty Income to lease back the properties on a commercial triple-net basis for an initial 15-year term, subject to the company’s option to extend the lease for up to an additional 20 years.

The company expects to use approximately $53.2 million of the net cash proceeds to repay debt and associated obligations related to certain of the properties and the remainder for general corporate purposes.

Par Pacific anticipates that the companies will complete the sale-leaseback transaction in first-quarter 2021, subject customary closing conditions. There will be no disruption of operations or customers as a result of the sale-leaseback transaction, as the Company will continue to operate its retail business at the leased properties according to the lease.

Realty Income owns more than 6,500 real estate properties under long-term lease agreements with commercial tenants.

Par Pacific owns and operates one of the largest energy networks in Hawaii with 148,000-bpd of combined refining capacity, a logistics system supplying the major islands and 91 retail locations. In the Pacific Northwest and the Rockies, Par Pacific owns and operates 60,000-bpd of combined refining capacity, related logistics systems and 33 retail locations. Par Pacific also owns 46% of Laramie Energy, a natural gas production company with operations and assets concentrated in Western Colorado.

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