Net lease REIT W. P. Carey Inc. (WPC) said Tuesday it is working with German home improvement retailer Hellweg to take back 12 store leases. Accordingly, landlord and tenant have executed an agreement to terminate leases on seven stores by September 2025 and on five more stores by September 2026.
In a business update on Tuesday, WPC noted that Hellweg, its fifth-largest tenant, remains current on rent but continues to face a challenging operating environment, including weak German consumer spending and a competitive German do-it-yourself industry. “To support its ongoing turnaround, Hellweg is working to improve liquidity with its key stakeholders, including its landlords and lenders,” according to WPC.
The REIT said it’s actively negotiating with other operators to lease eight of the stores at rents comparable to current levels. Leases with new tenants are expected to be signed ahead of the Hellweg termination dates, minimizing the impact on WPC’s adjusted funds from operations. Negotiations are ongoing to sell the four remaining stores.
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