Parkway to purchase NASCAR Plaza in North Carolina for USD100m
Parkway Properties is to acquire NASCAR Plaza, a 390,000 square foot office tower located in the central business district of Charlotte, North Carolina, from a joint venture between Trinity Capital Advisors and Rubenstein Partners for approximately USD100m.
NASCAR Plaza was built in 2009 and is a 20-story, LEED Silver certified office tower. The building is adjacent to the NASCAR Hall of Fame and is the headquarters for NASCAR, which has leased 139,000 square feet through May 2021.
Currently, the building is 88 per cent leased with an average in place rent per square foot of USD25.61.
James R. Heistand, Parkway's president and chief executive officer, says: "The purchase of NASCAR Plaza represents another off-market transaction that enables us to expand in one of our key, target submarkets with a high-quality asset. NASCAR Plaza has a strong tenant base and is the headquarters for several well-known companies, and we expect to create additional value through leasing and rent growth in a submarket that we believe will outperform during a recovery."
NASCAR Plaza is expected to generate a 2013 estimated cash net operating income yield of approximately seven per cent.
Parkway will own 100 per cent of the asset and plans to assume the first mortgage secured by the property, which has a current outstanding balance of approximately USD42.3m with a current interest rate of 4.7 per cent and a maturity date of 30 March 2016; however, Parkway intends to amend and restate the loan upon assumption to current market terms.
Closing is expected to occur by the end of the fourth quarter 2012 and is subject to customary closing conditions.
Parkway intends to fund its share of equity using excess cash and borrowings from its revolving credit facility.