VEREIT CEO Says Cole Capital Sale Will Help Complete REIT’s Transformation

Glenn Rufrano, CEO of VEREIT, Inc. (NYSE: VER), joined Nareit for a video interview at REITworld 2017.

VEREIT manages a portfolio of retail, restaurant, office and industrial real estate assets subject to long-term net leases.

Rufrano reflected on some of the changes that VEREIT has undertaken since he took over as CEO in 2015. Those changes include the sale of $3.1 billion in assets during the last two years. The company has also cut its debt.

Rufrano commented on the recent sale of Cole Capital, VEREIT’s investment management business, to CIM Group. He pointed out that VEREIT had worked to restore the Cole brand and had regained many of the broker-dealer relationships that had been lost prior to 2015. While Cole was a valuable asset, strategically it was not a good fit for VEREIT, Rufrano said.

The sale of Cole will help complete VEREIT’s change into a large, diversified single-tenant net lease company, Rufrano said.

VEREIT has also been active in the capital markets, issuing $1.2 billion of bonds and $700 million of equity, according to Rufrano.

Meanwhile, Rufrano said he expects that VEREIT will make a few additional tweaks to its portfolio. Those changes include reducing Red Lobster’s share of the portfolio to around 5 percent by the end of 2018 and reducing the office portfolio slightly.

“Once we do that, the portfolio will be in really good shape,” Rufrano said.

Turning to VEREIT’s retail tenants, Rufrano said the majority are discount and service-oriented clients, “so we feel pretty good” in the face of the growth of e-commerce. At the same time, he noted that VEREIT ensures that its tenants “embrace” online retail and have the capacity to increase their e-commerce activities.

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