Current Report Filing (8-k)
14 February 2022 - 10:21PM
Edgar (US Regulatory)
0001568162
false
12-31
true
0001568162
2022-02-10
2022-02-10
0001568162
us-gaap:CommonStockMember
2022-02-10
2022-02-10
0001568162
us-gaap:SeriesAPreferredStockMember
2022-02-10
2022-02-10
0001568162
us-gaap:SeriesCPreferredStockMember
2022-02-10
2022-02-10
0001568162
RTL:PreferredStockPurchaseRightsMember
2022-02-10
2022-02-10
iso4217:USD
xbrli:shares
iso4217:USD
xbrli:shares
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
February 10, 2022
The Necessity Retail REIT, Inc.
(Exact Name of Registrant as Specified in
Charter)
Maryland
|
|
001-38597
|
|
90-0929989
|
(State or other jurisdiction
of incorporation)
|
|
(Commission File Number)
|
|
(I.R.S. Employer
Identification No.)
|
650 Fifth Avenue, 30th Floor
New York, New York 10019
|
(Address, including zip code, of Principal
Executive Offices)
Registrant’s telephone number,
including area code: (212) 415-6500
|
American Finance Trust, Inc.
(Former name or former address, if changed since
last report)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨
|
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|
|
|
¨
|
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|
|
|
¨
|
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|
|
|
¨
|
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
|
Securities registered pursuant to section 12(b) of the Act:
Title of each class:
|
|
Trading
Symbol(s)1
|
|
Name of each exchange on which registered:
|
Class
A Common Stock, $0.01 par value
|
|
RTL
|
|
The Nasdaq Global Select Market
|
7.50% Series A Cumulative Redeemable
Perpetual Preferred Stock, $0.01 par value
|
|
RTLPP
|
|
The Nasdaq Global Select Market
|
7.375% Series C Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share
|
|
RTLPO
|
|
The Nasdaq Global Select Market
|
Preferred Stock Purchase Rights
|
|
|
|
The Nasdaq Global Select Market
|
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2
of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate
by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
1 As of the date of this filing, the trading symbols for
the Company on The Nasdaq Global Select Market are “AFIN,” “AFINP” and “AFINO,” respectively, but
will be changed to the listed trading symbols on February 15, 2022.
Item 2.01 Completion
of Acquisition or Disposition of Assets
On
February 11, 2022, The Necessity Retail REIT, Inc., a Maryland corporation (the “Company”), through
wholly owned subsidiaries of The Necessity Retail REIT Operating Partnership, L.P., the Company’s operating partnership (the
“Operating Partnership”), acquired 44 properties (the “First Closing Properties”)
from certain subsidiaries of CIM Real Estate Finance Trust, Inc. (the “Sellers”)
pursuant to the previously disclosed purchase and sale agreement among the Company, the Operating Partnership and the Sellers. The First
Closing Properties consist of 44 power centers and grocery-anchored multi-tenant retail centers and a detention pond parcel. The acquired
properties are located across 17 states and aggregate approximately 4.5 million square feet, and represent the first tranche of the Company’s
previously announced acquisition of 81 properties (together, the “CIM Portfolio”) from the Sellers. The First
Closing Properties contain approximately 4.5 million rentable square feet and were 91% leased to 277 tenants as of September 30,
2021. As of September 30, 2021, those leases had a weighted average remaining lease term of 4.2 years. Neither
the Sellers nor CIM Real Estate Finance Trust have a material relationship with the Company, the Operating Partnership or any of
their respective subsidiaries and the acquisition was not an affiliated transaction.
The
aggregate purchase price of the First Closing Properties was $547.4 million, excluding closing costs. The Company funded the purchase
price of the First Closing Properties from a combination of cash on the balance sheet, including net proceeds from the $261 million sale
of three office buildings leased to Sanofi S.A. and proceeds from the Company’s offering of senior notes as well as a $170 million
draw under the Company’s credit facility and the issuance of $26.7 million in value of the Company’s Class A common stock,
par value $0.01 per share.
The following table lists information about the First Closing Properties:
Portfolio
|
|
Number of
Properties
|
|
|
Rentable Square Feet
|
|
|
Remaining Lease Term(1)
|
|
|
Percentage Leased2
|
|
Beaver Creek Shopping Center
|
|
|
1
|
|
|
|
284,322
|
|
|
|
4.9
|
|
|
|
88%
|
|
Brynwood Square
|
|
|
1
|
|
|
|
121,451
|
|
|
|
0.9
|
|
|
|
86%
|
|
Carlisle Crossing
|
|
|
1
|
|
|
|
152,487
|
|
|
|
3.6
|
|
|
|
81%
|
|
Crosspoint Shopping Center
|
|
|
1
|
|
|
|
170,121
|
|
|
|
5.3
|
|
|
|
88%
|
|
Crossroads Annex
|
|
|
1
|
|
|
|
40,578
|
|
|
|
2.8
|
|
|
|
100%
|
|
Crossroads Commons
|
|
|
1
|
|
|
|
47,217
|
|
|
|
3.8
|
|
|
|
100%
|
|
Darien Towne Centre
|
|
|
1
|
|
|
|
177,162
|
|
|
|
3.2
|
|
|
|
93%
|
|
Derby Marketplace
|
|
|
1
|
|
|
|
100,000
|
|
|
|
6.8
|
|
|
|
100%
|
|
Dick's PetSmart Center
|
|
|
1
|
|
|
|
52,302
|
|
|
|
4.4
|
|
|
|
100%
|
|
Enid Crossing
|
|
|
1
|
|
|
|
47,979
|
|
|
|
4.2
|
|
|
|
100%
|
|
Evergreen Marketplace
|
|
|
1
|
|
|
|
49,842
|
|
|
|
3.2
|
|
|
|
100%
|
|
Fairlane Green II
|
|
|
1
|
|
|
|
95,000
|
|
|
|
5.8
|
|
|
|
100%
|
|
Fountain Square
|
|
|
1
|
|
|
|
166,346
|
|
|
|
3.7
|
|
|
|
77%
|
|
FreshThyme & DSW
|
|
|
1
|
|
|
|
49,033
|
|
|
|
2.6
|
|
|
|
100%
|
|
Lord Salisbury Center
|
|
|
1
|
|
|
|
113,821
|
|
|
|
3.9
|
|
|
|
98%
|
|
Market at Clifty Crossing
|
|
|
1
|
|
|
|
198,014
|
|
|
|
3.0
|
|
|
|
77%
|
|
Mattress Firm & Aspen Dental
|
|
|
1
|
|
|
|
10,254
|
|
|
|
2.8
|
|
|
|
35%
|
|
Mattress Firm & Five Guys
|
|
|
1
|
|
|
|
7,638
|
|
|
|
6.3
|
|
|
|
100%
|
|
Mattress Firm & Panera Bread
|
|
|
1
|
|
|
|
8,800
|
|
|
|
6.3
|
|
|
|
100%
|
|
MattressFirm & Kay Jewelers
|
|
|
1
|
|
|
|
6,500
|
|
|
|
4.1
|
|
|
|
100%
|
|
Melody Mountain
|
|
|
1
|
|
|
|
65,525
|
|
|
|
2.3
|
|
|
|
100%
|
|
NordstromRack FL-Tampa
|
|
|
1
|
|
|
|
45,457
|
|
|
|
9.2
|
|
|
|
98%
|
|
Owensboro Town Center
|
|
|
1
|
|
|
|
164,941
|
|
|
|
3.6
|
|
|
|
92%
|
|
Pecanland Plaza
|
|
|
1
|
|
|
|
111,801
|
|
|
|
3.6
|
|
|
|
94%
|
|
PetSmart & Old Navy
|
|
|
1
|
|
|
|
28,970
|
|
|
|
8.7
|
|
|
|
100%
|
|
Plainfield Marketplace
|
|
|
1
|
|
|
|
125,337
|
|
|
|
1.8
|
|
|
|
86%
|
|
Plaza San Mateo
|
|
|
1
|
|
|
|
63,266
|
|
|
|
3.3
|
|
|
|
98%
|
|
Rolling Acres
|
|
|
1
|
|
|
|
189,132
|
|
|
|
3.7
|
|
|
|
96%
|
|
Shippensburg Marketplace
|
|
|
1
|
|
|
|
59,866
|
|
|
|
6.4
|
|
|
|
84%
|
|
Shoe Carnival & Buffalo Wild Wings
|
|
|
1
|
|
|
|
14,859
|
|
|
|
6.1
|
|
|
|
100%
|
|
Shoppes at Stroud
|
|
|
1
|
|
|
|
140,910
|
|
|
|
4.8
|
|
|
|
94%
|
|
Shoppes of Gary Farms
|
|
|
1
|
|
|
|
99,768
|
|
|
|
2.4
|
|
|
|
95%
|
|
Shops at Abilene
|
|
|
1
|
|
|
|
175,642
|
|
|
|
3.8
|
|
|
|
97%
|
|
Southwest Plaza
|
|
|
1
|
|
|
|
367,974
|
|
|
|
3.0
|
|
|
|
77%
|
|
Summerfield Crossing
|
|
|
1
|
|
|
|
113,500
|
|
|
|
2.6
|
|
|
|
100%
|
|
Sutters Creek
|
|
|
1
|
|
|
|
80,004
|
|
|
|
7.5
|
|
|
|
100%
|
|
Tellico Village
|
|
|
1
|
|
|
|
40,928
|
|
|
|
6.5
|
|
|
|
100%
|
|
The Market at Polaris
|
|
|
1
|
|
|
|
111,328
|
|
|
|
6.1
|
|
|
|
65%
|
|
Triangle Town Place
|
|
|
1
|
|
|
|
149,471
|
|
|
|
5.0
|
|
|
|
94%
|
|
Turfway Crossing
|
|
|
1
|
|
|
|
99,578
|
|
|
|
2.0
|
|
|
|
95%
|
|
University Marketplace
|
|
|
1
|
|
|
|
86,224
|
|
|
|
3.5
|
|
|
|
100%
|
|
Ventura Place
|
|
|
1
|
|
|
|
67,195
|
|
|
|
6.0
|
|
|
|
93%
|
|
Wallace Commons II
|
|
|
1
|
|
|
|
110,922
|
|
|
|
5.3
|
|
|
|
100%
|
|
Westover Market
|
|
|
1
|
|
|
|
60,646
|
|
|
|
6.8
|
|
|
|
100%
|
|
Total
|
|
|
44
|
|
|
|
4,472,111
|
|
|
|
4.2
|
|
|
|
91%
|
|
|
(1)
|
Remaining lease term in years as of September 30, 2021. Since the portfolio has multiple properties with varying lease expirations, remaining lease term is calculated as a weighted-average based on annualized rental income on a straight-line basis.
|
|
(2)
|
Occupancy data as of September 30, 2021
|
The Company expects to complete
the acquisition of the remaining properties in the CIM Portfolio in the first quarter of 2022. There can be no assurance that any subsequent
closing will occur, or of the timing of any such closing.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation
under an Off-Balance Sheet Arrangement of a
Registrant.
On February 11, 2022, the Company, through the Operating Partnership,
drew $170 million from its existing credit facility with BMO Harris Bank, N.A. in connection with the acquisition of the First Closing Properties.
A description of the credit facility is included in the Company’s
Current Report on Form 8-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on October 3, 2021. The description
is a summary and is qualified in its entirety by the terms of the credit agreement relating to the credit facility, which was filed with
the SEC as Exhibit 10.1 to the Company’s Current Report on Form 8-K filed with the SEC on October 3, 2021 and is incorporated by
reference herein.
Item 3.02 Unregistered Sales of Equity Securities.
As noted in Item 2.01 above, on February 11,
2022, the Company issued 3,264,693 shares of Class A common stock with a value for these purposes equal to $26,694,088.78 to satisfy
a portion of the purchase price of the First Closing Properties. The issuance of the shares of Class A
Common Stock was made in reliance on the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended
(the “Securities Act”), and Regulation D thereunder.
Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change
in Fiscal Year.
Change of Corporate Name and Trading Symbol Changes
Effective February 10, 2022, the Company amended
its charter to change its name from “American Finance Trust, Inc.” to “The Necessity Retail REIT, Inc.” The name change
was effected pursuant to an amendment to the Company’s charter (the “Charter Amendment”), which was filed with the Maryland
State Department of Assessments and Taxation. A copy of the Charter Amendment is attached hereto as Exhibit 3.1. Effective on the same date, the Operating Partnership changed its name from “American Finance Operating Partnership,
L.P.” to “The Necessity Retail REIT Operating Partnership, L.P.”
In addition, beginning February 15, 2022, in connection
with changing its name, the trading symbol of the Company’s Class A Common Stock on The Nasdaq Global Select Market will become
“RTL”, and the trading symbols of its 7.50% Series A Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value
per share, and 7.375% Series C Cumulative Redeemable Perpetual Preferred Stock, $0.01 par value per share, will become RTLPP and
RTLPO, respectively.
Item 7.01 Regulation FD Disclosure.
On February 11, 2022, the Company issued a press
release announcing the acquisition of the First Closing Properties and the change of the Company’s name.
A copy of the press release is attached as
Exhibit 99.1 to this Current Report on Form 8-K. This press release shall not be deemed “filed” for any purpose,
including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or
otherwise subject to the liabilities of that Section. The information in this Item 7.01, including Exhibit 99.1, shall not be deemed
incorporated by reference into any filing under the Exchange Act or the Securities Act, regardless of any general
incorporation language in such filing.
The statements contained in
this Current Report on Form 8-K that are not historical facts may be forward-looking statements. These forward-looking
statements involve risks and uncertainties that could cause the outcome to be materially different. In addition, words such as
“anticipates,” “believes,” “expects,” “estimates,” “projects,”
“plans,” “intends,” “seek,” “may,” “would” and similar expressions are
intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. These
forward-looking statements are subject to risks, uncertainties and other factors, many of which are outside of the Company’s
control, which could cause actual results to differ materially from the results contemplated by the forward-looking statements.
These risks and uncertainties include the potential adverse effects of the ongoing global COVID-19 pandemic, including actions taken
to contain or treat COVID-19, on the Company, the Company’s tenants and the global economy and financial markets as well as
those set forth in the Risk Factors section of the Company’s most recent Annual Report on Form 10-K for the year ended
December 31, 2020 filed on February 25, 2021, and all other filings with the SEC after that date, as such risks,
uncertainties and other important factors may be updated from time to time in the Company’s subsequent reports including in particular the Company’s Current Report on Form 8-K dated December 20, 2021 and describing
additional facts and risk factors relating to the transaction described in this filing. In
particular, the transactions described are subject to closing conditions, including conditions that are outside of the
Company’s control, and the transactions described may not be completed on the contemplated terms, or at all, or they may be
delayed. The Company may not be able to obtain financing to acquire the remaining properties. Forward looking statements speak only
as of the date they are made, and the Company undertakes no obligation to update or revise any forward-looking statement to reflect
changed assumptions, the occurrence of unanticipated events or changes to future operating results, unless required to do so by
law.
Item 9.01 Financial Statements and Exhibits
(a) Financial Statements of Properties Acquired.
The financial statements required to be filed under Item 9.01(a) of
this Current Report on Form 8-K will be filed by amendment to this Current Report on Form 8-K no later than 71 days after the date the initial report on Form 8-K is required to be filed.
(b) Pro Forma Financial Information.
The pro forma financial information required to be filed under Item
9.01(b) of this Current Report on Form 8-K will be filed by amendment to this Current Report on Form 8-K no later than 71 days after the
date the initial report on Form 8-K is required to be filed.
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
|
THE NECESSITY RETAIL REIT, INC.
|
|
|
|
Date: February 14, 2022
|
By:
|
/s/ Edward M. Weil, Jr.
|
|
Name:
|
Edward M. Weil, Jr.
|
|
Title:
|
Chief Executive Officer and President
|
American Financial (NASDAQ:AFINP)
Historical Stock Chart
From Feb 2024 to Mar 2024
American Financial (NASDAQ:AFINP)
Historical Stock Chart
From Mar 2023 to Mar 2024