Investors bet on properties leased to SMEs; $15B CyrusOne acquisition closes

S&P Global Market Intelligence offers our top picks of real estate news stories published throughout the week.

Properties leased to single tenants, including small businesses, have attracted more buyers over the past 18 months as low interest rates pushed up prices of traditional commercial real estate such as apartments and warehouses, The Wall Street Journal reported. Big asset managers typically shun properties occupied by small enterprises, such as gas stations, doctor's offices and grocery stores, as the assets carry a bigger default risk, the report said.

Withco raised $32 million in venture funding from investors including Founders Fund Inc., Canaan Partners and homebuilder Lennar Corp., for its rent-to-own deals with small and medium-sized enterprises. The New York landlord offers tenants the option to buy their space at a fixed price to keep vacancies low, a strategy the company expects will appeal to socially focused funds.

Keyway, which is also based in New York, obtained a $70 million debt facility from a group of banks. The company buys and leases back medical office buildings, which have proven more resilient than other property types during the pandemic.

Real estate investment trust STORE Capital Corp. spent $1.5 billion in 2021 to expand its single-tenant property portfolio.

M&A

* Global Infrastructure Partners LP and KKR & Co. Inc.-managed funds completed the $15 billion acquisition of CyrusOne Inc. The data center real estate investment trust requested the delisting of its common stock from the Nasdaq Global Select Market as part of the closing.

* An affiliate of Centerbridge Partners LP acquired title insurance underwriter Title Resources Guaranty Co. from residential real estate services company Realogy Holdings Corp. for $210 million in cash. Realogy will hold a 30% stake in Title Resources under a newly formed limited partnership joint venture with Centerbridge.

Property trades

* Xenia Hotels & Resorts Inc. completed the $328.7 million acquisition of the 346-room W Nashville hotel in Tennessee.

* Callahan Capital Partners and Oak Hill Advisors LP acquired The Howard Hughes Corp.'s equity stake in 110 North Wacker Drive office tower in Chicago for $210 million. The 55-story class A office property spans 1.5 million square feet and is more than 82% leased.

* Real estate company Tishman bought the 400-room Wyndham Grand Orlando Bonnet Creek hotel in Orlando, Fla., from Wyndham Hotels & Resorts for $120.5 million, the Orlando Business Journal reported, citing Orange County records.

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