Unassociated Document
FILED
PURSUANT TO
RULE
424(b)(3)
FILE NO.
333-145949
AMERICAN
REALTY CAPITAL TRUST, INC.
SUPPLEMENT
NO. 10 DATED June 2, 2009
TO THE
PROSPECTUS DATED March 18, 2008
This
prospectus supplement (this “Supplement No. 10”) is part of the prospectus of
American Realty Capital Trust, Inc. (the “REIT” or the “Company”), dated March
18, 2008 (the “Prospectus”), Supplement No. 8, dated April 14, 2009 (“Supplement
No. 8”), and Supplement No. 9, dated May 13, 2009 (“Supplement No. 9”) and
should be read in conjunction with the Prospectus and Supplement Nos. 8 and 9.
This Supplement No. 10 supplements, modifies or supersedes certain information
contained in our Prospectus and Supplement Nos. 8 and 9 and must be read in
conjunction with our Prospectus and Supplement Nos. 8 and 9. This Supplement No.
10 will be delivered with the Prospectus.
The
purpose of this Supplement No. 10 is to disclose a potential acquisition of the
REIT.
Potential
Property Investments
The
following information is to replace the section in our Prospectus captioned
“Potential Property Investments” on page 90 of the Prospectus.
The
acquisition of each such property is subject to a number of conditions. A
significant condition to acquiring any one of these potential acquisitions is
our ability to raise sufficient proceeds in this offering to pay a portion of
the purchase price. An additional condition to acquiring these properties will
be our securing debt financing to pay the balance of the purchase price. Such
financing may not be available on acceptable terms or at all.
Our
evaluation of a property as a potential acquisition, including the appropriate
purchase price, will include our consideration of a property condition report;
unit-level store performance; property location, visibility and access; age of
the property, physical condition and curb appeal; neighboring property uses;
local market conditions, including vacancy rates; area demographics, including
trade area population and average household income; neighborhood growth patterns
and economic conditions; and the presence of demand generators.
We will
decide whether to acquire properties generally based upon:
|
·
|
satisfaction
of the conditions to the acquisitions contained in the respective
contracts;
|
|
·
|
no
material adverse change occurring relating to the properties, the tenants
or in the local economic
conditions;
|
|
·
|
our
receipt of sufficient net proceeds from the offering of our common stock
to the public and financing proceeds to make these acquisitions;
and
|
|
·
|
our
receipt of satisfactory due diligence information including appraisals,
environmental reports and tenant and lease
information.
|
Our
advisor has identified the property described below as potential suitable
investments for us. The acquisition of the property is subject to a number of
conditions. A significant condition to acquiring the potential acquisition is
our ability to raise sufficient proceeds in this offering to pay all or a
portion of the purchase price.
FedEx
Freight Facility – Houston, TX
The REIT
anticipates acquiring a newly constructed freight facility net leased to FedEx
Freight and guaranteed by FedEx Corporation (the “FedEx Facility”) in June 2009.
In May 2009, the REIT’s Board of Trustees approved the acquisition of the FedEx
Facility. Although the REIT believes that the acquisition of the
FedEx Facility is probable, there can be no assurance that this acquisition will
be consummated.
On April
7, 2009, American Realty Capital II, LLC entered into a purchase agreement with
the obligation to purchase the FedEx Facility, subject to customary closing
conditions. Prior to closing, American Realty Capital II, LLC will assign
the purchase and sale agreement to an entity owned and controlled by the
REIT. The purchase price for the FedEx Facility is approximately
$30,902,000. The closing costs and fees payable to American Realty Capital
Advisors, LLC are expected to equal approximately $470,000. The purchase price
will be paid with proceeds from the sale of common shares and first mortgage
indebtedness. The FedEx Facility is a freight facility of approximately 153,000
square feet located in Houston, TX. The current sole tenant of the property is
FedEx Freight, a subsidiary of FedEx Corporation (“FedEx”) and will remain the
sole tenant on a double-net lease basis.
Address
|
City,
State
|
Purchase
Price
|
Approximate
Compensation
to
Advisor and
Affiliates
|
9010
Jackrabbit Road
|
Houston,
TX
|
$30,902,000
|
$470,000
|
The Fed
Ex Facility is net leased to FedEx, pursuant to which FedEx will be required to
pay substantially all operating expenses (other than the costs to maintain and
repair the roof and structure of the building) and capital expenditures in
addition to base rent, simultaneously with the acquisition of the property, and
will have a primary lease term of fifteen years. Annual rent is $2,580,315 for
the first year of the initial lease term, and annual rent will increase by 8.02%
every five years. The lease provides for up to two extensions of successive
five-year terms.
Address
|
|
City,
State
|
Total
Square
Feet
Leased
|
Year
1 Gross
Rent
|
Rent
Per
Square
Foot
|
Remaining
Lease
Term
(Years)(1)
|
9010
Jackrabbit Road
|
|
Houston,
TX
|
152,640
|
$2,580,315
|
$16.90
|
14.3
|
|
(1)
|
Lease
expires on September 30, 2023.
|
The REIT
has secured first mortgage indebtedness from KBC Bank, N.A. The
following table outlines the loan terms of the debt financing incurred in
connection with acquisition of the FedEx Facility. The loan will be secured by a
mortgage on the FedEx Facility.
|
|
|
|
|
Mortgage Debt
Amount
|
|
Rate
|
|
Maturity
Date
|
$16,059,000
|
|
Approximately
6.50%
|
|
June
2019
|
FedEx
Corporation provides transportation, e-commerce, and business services in the
United States and internationally. FedEx has more than 290,000 employees in over
220 countries and operates in excess of 4,000 facilities servicing the FedEx
brands. It is headquartered in Memphis, Tennessee. FedEx is rated BBB by
Standard & Poor’s.
FedEx
Corporation currently files its financial statements in reports filed with the
Securities and Exchange Commission, and the following financial information is
from FedEx’s Quarterly Report on Form 10-Q, for the period ended February 28,
2009 and the 2008 annual report:
|
Three
Months
Ended
|
|
For the Fiscal Year
Ended
|
|
Consolidated
Statements of Income
(in millions)
|
February 28,
2009
|
|
2008
|
|
2007
|
|
2006
|
|
Revenues
|
|
$ |
8,137 |
|
|
$ |
37,953 |
|
|
$ |
35,214 |
|
|
$ |
32,294 |
|
Operating
Income
|
|
|
182 |
|
|
|
2,075 |
|
|
|
3,276 |
|
|
|
3,014 |
|
Net
Income
|
|
|
97 |
|
|
|
1,125 |
|
|
|
2,016 |
|
|
|
1,806 |
|
|
As of May
31,
|
|
Consolidated
Balance Sheets (in millions)
|
2008
|
|
2007
|
|
Total
Assets
|
|
$ |
25,633 |
|
|
$ |
24,000 |
|
Total Liabilities
|
|
|
11,107 |
|
|
|
11,344 |
|
Stockholders’
Equity
|
|
|
14,526 |
|
|
|
12,656 |
|
For more
detailed financial information regarding FedEx Corporation, please refer to its
financial statements, which are publicly available with the Securities and
Exchange Commission at http://www.sec.gov.