WP Carey Completes $63M Industrial Sale-Leaseback

(Read more on the debt and equity markets and the industrial market.)

NEW YORK CITY-Investment firm WP Carey & Co. LLC has completed a $63-million sale-leaseback transaction with International Aluminum Corp., a portfolio company of San Francisco-based private equity firm, Genstar Capital LLC. WP Carey’s affiliated income generating real estate fund, CPA:16–Global, acquired nine industrial facilities from International Aluminum throughout the US and Canada, including properties in Los Angeles, Chicago, San Francisco, Phoenix, Houston, and Vancouver and has leased them back to the company under long-term lease agreements.

Monterey Park, CA-based International Aluminum is a manufacturer of aluminum and vinyl building products used for both commercial and residential applications such as store fronts, decorative entrance doors, and aluminum windows and doors. “W. P. Carey’s investment in the IAL [International Aluminum's] properties is consistent with our approach of identifying and providing financing for creditworthy companies,” says Jason Fox, executive director at WP Carey. “In this case, the sale-leaseback was an integral component of IAL’s capital structure.”

Fox continues that “by providing a long-term source of funding at an attractive rate it will further strengthen IAL’s capital structure and help lay the groundwork for the company’s continued success in the aluminum and vinyl building products segment,” he says. “The transaction is an excellent example of how working with private equity firms and their portfolio companies we can structure a sale-leaseback financing that maximizes returns for the company’s owners and at the same time conforms to our established investment parameters.”

“Since we acquired IAL earlier this year we have implemented a number of initiatives to enhance the business,” says Darren Gold, a managing director at Genstar. “As part of those efforts to grow the company, WP Carey’s sale-leaseback provides further financial flexibility to do a myriad of things: target future add-on acquisitions, pay dividends to our shareholders, or enhance any one of our portfolio businesses. WP Carey’s ability to understand our financial objectives along with IAL’s operating requirements enabled us to structure a long term financing solution that provides a solid platform for future growth opportunities.”