Vornado to Sell AmeriCold Realty Trust for $220M, Records $110M Gain

Vornado Realty Trust has agreed to sell its entire interest in AmeriCold Realty Trust, a third-party logistics supplier to the food industry, to The Yucaipa Cos., a Los Angeles based investment firm with interests in grocery store chains. Vornado owned a 47.6 percent share and will receive net proceeds of approximately $220 million, resulting in a gain of approximately $110 million. The sales price is based on a valuation of $1.52 billion before debt and other obligations. Morgan Stanley Real Estate has also agreed to sell its 31.7 percent interest in AmeriCold to Yucaipa, which will then own 100 percent of the company. Today’s deal is the culmination of a series of transactions that began a decade ago in 1997, when Vornado and Crescent Real Estate Equities of Fort Worth formed a joint venture called AmeriCold Realty that acquired and consolidated four independent temperature controlled warehouse companies. Back then, REITs could not by law own non-real estate assets or conduct non-real estate operations. The companies purchased by AmeriCold Realty ran trucking companies, owned refrigeration trucks and carried fresh food. To remain in compliance with the law, AmeriCold Realty sold its non-real estate assets to AmeriCold Logistics, an entity established to provide the food industry with temperature controlled distribution services using the warehouse network leased from and owned by AmeriCold Realty. In turn, Vornado Operating Co. and Crescent Operating Inc. bought the logistics company and leased the space. Congress modernized the REIT laws in 2004 and allowed REITs to own operating companies. At that time AmeriCold Realty bought AmeriCold Logistics back and created a parent/subsidiary relationship that replaced the landlord/tenant relationship. At the same time, Yucaipa bought a 20.7 percent interest in the combined AmeriCold realty and logistics companies. The Vornado and Crescent joint venture retained a 79.3 percent share. In May of last year, Morgan Stanley Real Estate acquired Crescent, paying $6.5 billion. With Crescent came Crescent’s share of the AmeriCold joint venture. With today’s announcement, The Yucaipa Cos. became the sole owner of AmeriCold Realty Trust and its operating logistics companies.