8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): November 23, 2011

AMERICAN REALTY CAPITAL PROPERTIES, INC.

(Exact name of Registrant as specified in its charter)

Maryland	333-172205	45-2482685
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)

405 Park Avenue

New York, New York 10022

(Address, including zip code, of principal executive offices)

(212) 415-6500

Registrant’s telephone number, including area code: 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o   Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o   Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o   Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o   Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.01. Completion of Acquisition or Disposition of Assets.

On November 23, 2011, American Realty Capital Properties, Inc. (the “Company”) closed its acquisition of a fee simple interest in five freestanding, single-tenant Advance Auto Parts stores located in Michigan (Sault Ste. Marie, Caro, Charlotte, Flint and Ypsilanti), at an aggregate contract purchase price of approximately $4.2 million, excluding closing costs. The Company acquired the properties through indirect wholly-owned subsidiaries of its operating partnership. The seller of the properties is Highlite, Inc. The seller does not have a material relationship with the Company and the acquisitions were not affiliated transactions. The Company previously filed the purchase and sale agreement that it entered into in connection with these properties as an exhibit to its Registration Statement on Form S-11 (Registration No. 333-176952). The purchase and sale agreement related to seven Advance Auto stores, one of which the Company decided not to acquire, without any penalty to the Company, after completing its due diligence review. The Company expects to close on a sixth Advance Auto store in the near future but there can be no assurance that the acquisition will be consummated. Pursuant to the terms of the purchase and sale agreement, American Realty Capital II, LLC, the Company’s sponsor, deposited $294,000 in escrow upon executing the purchase and sale agreement.

The tenant of the properties is Advance Stores Company, Inc., which has an investment grade credit rating as determined by major credit rating agencies, and is a wholly-owned operating subsidiary of Advance Auto Parts, Inc. (NYSE: AAP). The properties total approximately 35,000 square feet. Based on the aggregate annualized straight line rents, 63.4% of the leases for the properties have a 10-year term and 36.6% of the leases for the properties have a 5-year term, and the weighted average remaining term of these leases is approximately 7.5 years. Each of these leases has two five-year renewal options. Based on the aggregate annualized straight line rents, 63.4% of the leases for the properties contain rent escalation provisions at 4.5% in the fifth year of the lease term and 36.6% of the leases for the properties contain no rent escalation provisions. The leases are double net, whereby we are responsible for repairs and replacement costs to the foundation and structure and Advance Stores Company, Inc. is required to pay substantially all other operating expenses, in addition to base rent. The aggregate annualized current rents total approximately $367,500, or an average of approximately $10.50 per rentable square foot.

The following table provides, for each of the properties, information relating to tenants, sellers, lease commencement and termination dates, amount of lease term remaining, approximate rentable square footage and approximate annualized rental income.

Location	Lease Commencement Date	Lease Termination Date	Lease Term Remaining (Years)	Approximate Rentable Square Footage	Approximate Annualized Straight Line Income
Sault St. Marie, MI	April 2011	March 2021	9.4	7,000	75,000
Caro, MI	April 2011	March 2021	9.4	7,000	79,000
Charlotte, MI	April 2011	March 2021	9.4	7,000	82,000
Flint, MI	April 2011	March 2016	4.4	7,000	73,500
Ypsilanti, MI	April 2011	March 2016	4.4	7,000	63,000

The Company funded the acquisition of the properties, exclusive of closing costs, with proceeds from the sale of its common stock.  The Company may seek to obtain financing on one or more of the properties post-closing. However, there is no guarantee that it will be able to obtain financing on terms it believes are favorable, or at all.

As disclosed in its consolidated financial statements in reports filed with the U.S. Securities and Exchange Commission, Advance Auto Parts, Inc. conducts all of its operations through its wholly owned subsidiary, Advance Stores Company, Inc. (our tenant) and its subsidiaries, and therefore reports its annual financial statements on a consolidated basis for “Advance Auto Parts, Inc., its wholly owned subsidiary, Advance Stores Company, Incorporated, and its subsidiaries.” As a result, separate financial statements for our tenant are neither reported nor available to us.

Advance Auto Parts, Inc. operates as a retailer of automotive aftermarket parts, accessories, batteries, and maintenance items. The company’s operations are divided into two segments: Advance Auto Parts (AAP) and Autopart International (AI). The AAP segment operates stores which primarily offer auto parts, including, among other items, alternators, batteries, chassis parts, clutches, engines and engine parts, radiators, starters, and transmissions. The AI segment operates stores that provide replacement parts for domestic and imported cars and light trucks in northeast and Mid-Atlantic regions, as well as to warehouse distributors in North America. Advance Auto Parts, Inc. was founded in 1929 and is based in Roanoke, Virginia.

A copy of the press release announcing the acquisition of the property is included as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

Item 9.01.    Financial Statements and Exhibits.

(d)           Exhibits

Exhibit No.	Description
99.1	Press Release dated November 23, 2011

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	AMERICAN REALTY CAPITAL PROPERTIES, INC.
November 23, 2011	By:	/s/ Nicholas S. Schorsch
	Name:	Nicholas S. Schorsch
	Title:	Chief Executive Officer and
		Chairman of the Board of Directors

EX-99.1

CONTACTS
From: Anthony J. DeFazio	For: Brian S. Block, EVP & CFO
DeFazio Communications, LLC	American Realty Capital Properties, Inc.
tony@defaziocommunications.com	bblock@arlcap.com
Ph: 484-532-7783	Ph: 212-415-6500

FOR IMMEDIATE RELEASE

AMERICAN REALTY CAPITAL PROPERTIES, INC.

ANNOUNCES CLOSING OF $4.2 MILLION ADVANCE AUTO PORTFOLIO ACQUISITION

NEW YORK, NY, November 23, 2011 — American Realty Capital Properties, Inc., (“ARCP” or the “Company”) (NASDAQ: ARCP) announced today that it has closed on the acquisition of a portfolio of five free standing, single-tenant commercial buildings leased to leading automotive aftermarket retailer Advance Auto Parts (the “Advance Auto Portfolio”).  The total purchase price for the Advance Auto Portfolio was approximately $4.2 million, exclusive of customary closing costs.

The Advance Auto Portfolio is comprised of five retail auto parts stores located in Michigan totaling approximately 35,000 square feet with a weighted average remaining term of approximately 7.5 years.  Current annualized rents total approximately $367,500, or an average of approximately $10.50 per square foot.  The purchase price equates to a capitalization rate on current annualized rent of approximately 8.85%, or approximately $118.70 per square foot.

The tenant of these properties is Advance Stores Company, Inc., which has an investment grade credit rating, as determined by major credit rating agencies.  The Company funded the acquisition of these properties with proceeds from the recently completed secondary common share offering.   

“We are extremely pleased to add Advance Auto Parts as a tenant to our portfolio,” commented Nicholas Schorsch, Chairman and Chief Executive Officer of American Realty Capital Properties.  “With these properties, we continue to augment our portfolio with a high quality, credit tenant with strong current income, vintage in-place rents, at valuations significantly below replacement cost.  The acquisition of these properties further diversifies our existing portfolio and will increase total portfolio purchase price to approximately $145.2 million.  Since closing our secondary offering in early November, we have acquired 25 properties.”

American Realty Capital Properties, Inc. is a publicly-traded Maryland corporation listed on The NASDAQ Capital Market that intends to qualify as a real estate investment trust focused on owning and acquiring single tenant freestanding commercial properties subject to net leases with high credit quality tenants.  Additional information about the Company can be found on the Company’s website at www.americanrealtycapitalproperties.com.

For more information about this announcement, please contact Tony DeFazio of DeFazio Communications, LLC at 484-532-7783 or tony@defaziocommunications.com.

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