Attached files
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| 8-K - American Realty Capital Trust, Inc. | v187359_8k.htm |
Exhibit 99.1
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CONTACTS
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From:
Anthony J. DeFazio
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For:
Brian S. Block, EVP & CFO
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DeFazio
Communications, LLC
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American
Realty Capital Trust
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tony@defaziocommunications.com
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bblock@arlcap.com
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Ph:
(484-532-7783)
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Ph:
(212-415-6500)
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FOR
IMMEDIATE RELEASE
June 3,
2010
American
Realty Capital Advisors Waives REIT Internalization Fee
New York, NY - American Realty
Capital Trust, Inc. (“ARCT” or “the Company”) announced today that it has
reached agreement with its advisor, American Realty Capital Advisors, LLC, that
the Company will not be required to pay any compensation to its advisor in
connection with an internalization transaction.
Typically,
when a REIT in the public, non-traded industry reaches certain critical mass,
its board of directors elects to internalize the management functions previously
provided by an external advisor. Historically, the cost to the REIT
shareholders of such action has run from $70 million to over $350
million.
“This is
just one more step along the path our Company has chosen to take in establishing
“best practices,” said Nicholas S. Schorsch, CEO of American Realty Capital
Trust. “Waiving the internalization fee is important but
insufficient, if it is not coupled with low fees for acquisition, asset
management, and other services. Aligning interests between management
and shareholders means tying advisor pay to performance. Best
practices entails covering one’s distributions from operating income, and the
ability to sustain those dividends even in challenging times. Without
addressing all of these issues effectively, the best interests of the
shareholders can never be fully satisfied. At American Realty Capital
we have effectively wrestled with all of these pressing matters that go toward
creating shareholder equity. For us this is all about
continuing to build an enterprise of excellence as presented through all of our
investment solutions.”“ Last year we saw Healthcare Trust of America
become the first non-traded public REIT internalize all of its
management functions with no internalization fee,” said
Schorsch.“This was especially significant in that HTA was truly a major
enterprise; it had raised over $1 billion of equity by that time.”
American
Realty Capital Trust has also agreed with its advisor that any
subordinated listing fee or advisory agreement termination
payments due to the advisor would be paid when assets acquired during the period
were sold or financed. Payment of a subordinated listing fee or
termination fee would be in the form of a non-interest bearing
note. If after three years the note is not fully repaid, at advisor’s
option, the note may be converted to the Company’s stock.
American Realty Capital is a real estate
finance and investment firm
formed by Nicholas S. Schorsch and William M. Kahane. As CEO and
board member, respectively, the two were behind the growth of American Financial
Realty Trust, where they acquired over 1,500 properties valued at more than $5
billion. In the last five years, American Realty
Capital’s executive team has collectively
negotiated and closed on over $7 billion of bank branch and net-leased real
estate. American Realty Capital sponsors American Realty Capital Trust,
Inc., a publicly-registered, non-traded REIT acquiring single-tenant,
freestanding properties net leased long term to investment grade and
creditworthy tenants. Realty Capital Securities, LLC, member FINRA, SIPC,
is the dealer-manager for ARCT.
This press release may contain
forward-looking statements as defined in the Private Securities Litigation
Reform Act of 1995. Actual results and trends could differ materially from those
set forth in such statements due to various factors.
To arrange interviews with American
Realty Capital executives, please contact Tony DeFazio at 484-532-7783 or
tony@defaziocommunications.com.
This material does not constitute an
offer to sell nor a solicitation of an offer to buy any securities
described herein or otherwise. Only a prospectus for a specific securities
offering makes such an offer. In that regard, the use of this material is
authorized only when it is accompanied or preceded by a prospectus. Further, all
information contained in this material is qualified by the terms of a current
prospectus of the offering of securities to which it relates, if
any.
This material may contain
forward-looking statements that involve assumptions, uncertainties and risks,
some of which are set forth below. These statements are not guarantees and
should not be regarded as representations that the results or conditions
described in such statements, or that our objectives and/or plans, will be
achieved.
A real estate investment program
offering is subject to the following risks: The failure to qualify, or maintain
the requirements, to be taxed as a REIT would reduce the amount of income
available for distribution and limit a REIT's ability to make distributions to
its stockholders. No public market initially exists for a REIT's shares of
common stock, and one may never exist for this or any other such type of real
estate program. Securities are being offered on a best efforts basis. These are
speculative securities and as such involve a high degree of risk. There are
substantial conflicts among an offering and its sponsor, advisor, dealer manager
and property manager. There is no assurance that the value of the real estate
will be sufficient to return any portion of investors' original capital.
Operating results will be affected by economic and regulatory changes that have
an adverse impact on the real estate market and we cannot assure you that there
will be growth in the value of the properties.