NEW YORK, NY – February 25, 2003 – Investment firm W. P. Carey & Co. LLC (NYSE: WPC) announced today that it has acquired and leased-back 15 state-of-the-art health club centers from Denver-based Starmark Holdings LLC, the fourth largest health club operator in the country, for approximately $178 million. Starmark does business under the name Wellbridge.
Under the terms of the sale-leaseback transaction the 15 facilities will be leased under a single 20-year triple net lease. The facilities, totaling more than 1.6 million square feet, are located in Boca Raton and Tampa, FL; Newton, MA; Bloomington (2), Brooklyn Center, Burnsville, Eden Prairie (2), Fridley, Minnetonka and St. Louis Park, MN; and Albuquerque (3), NM. The facilities were purchased on behalf of Corporate Property Associates 12 Inc. (CPA®:12), Corporate Property Associates 14 Inc. (CPA®:14) and Corporate Property Associates 15 Inc. (CPA®:15), members of the $4.6 billion W. P. Carey Group of publicly held non-traded real estate investment trusts (REITs).
Edward V. LaPuma, Managing Director at W. P. Carey’s said, “The health club industry is a $13 billion business and has been growing. As one of the most successful operators in the industry, Wellbridge has created an excellent reputation of operating one of the finest fitness centers and spas in the country. This sale-leaseback transaction not only frees up substantial capital, but these state-of-the-art facilities will further diversify the portfolios of our REITS.”
Anne R. Coolidge, an Executive Director of W. P. Carey, added, “This transaction represents our continued commitment to finding and acquiring quality properties in key markets throughout the United States. We were impressed with the Wellbridge management team and their commitment and success in running the premier athletic health clubs in the country.”
“Wellbridge was built through the strategy of acquiring and successfully turning around athletic health clubs in lucrative regional markets,” said Eddie D. Williams, CEO of Wellbridge. "This deal with W. P. Carey allows us to aggressively consider future acquisitions which will enable us to remain a leader in the industry.”
Wellbridge is a leading operator of premier athletic clubs, spas and fitness/wellness centers with over 45 properties in 11 states, 5,000 employees and 200,000 members. With a strategic business model, exceptional talent and proprietary fitness, wellness and spa programs developed for both baby boomers and matures, Wellbridge is poised for steady growth in the mid to upper market of the industry.
CPA®:12, CPA®:14 and CPA®:15 invest in single-tenant commercial properties which are typically purchased under a long-term, triple-net lease in which the tenant is responsible for maintaining the premises, insuring the buildings and paying real estate taxes. Launched in November 2001, CPA®:15 currently has an ownership interest in 83 properties net leased to 23 tenants in 24 states and France. CPA®:14 was founded in 1997 and currently has a diversified portfolio consisting of 152 properties net leased to 63 tenants comprised of more than 21.6 million square feet Founded in 1993, CPA®:12’s current diversified portfolio consists of 94 properties net leased to 43 tenants comprised of more than 7.7 million square feet.
Founded in 1973, W. P. Carey & Co. specializes in corporate real estate financing through the corporate net lease, or sale-leaseback structure. The firm and its affiliates continue to be the leading lessors of net leased corporate real estate in the United States. As the largest publicly traded limited liability company in the world, the company owns and/or manages more than 500 commercial and industrial properties throughout the United States and Europe comprised of more than 60 million square feet of space.
This press release contains forward-looking statements within the meaning of the Federal securities laws. A number of factors could cause the company's actual results, performance or achievement to differ materially from those anticipated. Among those risks, trends and uncertainties are the general economic climate; the supply of and demand for office and industrial properties; interest rate levels; the availability of financing; and other risks associated with the acquisition and ownership of properties, including risks that the tenants will not pay rent, or that costs may be greater than anticipated. For further information on factors that could impact the company, reference is made to the company's filings with the Securities and Exchange Commission.
