posted on August 05, 2011 23:26
Wal-Mart Corp. acquired the 4 million-square-foot distribution complex it operates in Baytown from the State of Texas Permanent School Fund for $104.5 million.
The transaction closed June 30.
The state’s General Land Office, which invests in real estate property for the Permanent School Fund, bought the pair of 2 million-square-foot buildings from Wal-Mart for $100 million when they were constructed in 2005. The 240-acre project was then leased back to the Bentonville, Ark.-based retail giant for 30 years. Wal-Mart also had an option to repurchase the mammoth facilities.
When the original leaseback was inked in 2005, the Permanent School Fund expected to receive $203 million in lease payments from Wal-Mart over the 30-year term.
The state reported Thursday that it ultimately earned more than $40 million over the past six years on the $100 million investment.
Wal-Mart stood to benefit from the leaseback transaction by being exempt from paying tax on the property during the 30-year lease.
7/14/11, Jennifer Dawson, Houston Business Journal