Sold sign

Parkway to buy eight office buildings in Jacksonville, Florida

Wed, 23/01/2013 - 12:24

Parkway Properties is to acquire a portfolio of eight office properties totalling 1.0 million square feet located in the Deerwood submarket of Jacksonville, Florida for a purchase price of USD130m. 

The properties were developed in phases from 1996 through 2005 and are currently a combined 93.7 per cent occupied with an average in place gross rent per square foot of USD19.11.

James R Heistand, Parkway's president and chief executive officer, says: "We believe the Deerwood portfolio offers a stable, core investment with strong occupancy and a high-quality rent roll. The Deerwood submarket has been a targeted growth area for Parkway given its prime location and the many amenities it offers, attracting a multitude of institutional and strong credit tenants to the area. Parkway will have a critical mass in this submarket, owning approximately 29 per cent of the total office inventory, which should provide us with operational efficiencies and leasing advantages. In addition, our attractive cost basis of USD128 per square foot represents a significant discount to estimated replacement cost."

The Deerwood portfolio is expected to generate an initial full-year cash net operating income yield of approximately nine per cent. Parkway will own 100 per cent of the portfolio and plans to place secured financing on the properties simultaneous with closing totalling up to 65 per cent of the purchase price. Parkway intends to fund the remaining equity using borrowings from its revolving credit facility. Closing is expected to occur by the end of the first quarter 2013 and is subject to customary closing conditions, including completion of satisfactory due diligence.

The Deerwood submarket is comprised of approximately 3.5 million square feet and has a direct vacancy rate of 9.7 per cent as of 31 December 2012, according to CBRE.

On 17 January 2013, Parkway completed the previously announced purchase of Tower Place 200, a 260,000 square foot office tower located in the Buckhead submarket of Atlanta, Georgia, for a purchase price of USD56.0m. Tower Place 200 was built in 1998 and is a 13-story, Class A office tower that shares a parking garage with Parkway's neighbouring 3344 Peachtree asset. The building is approximately 82.9 per cent occupied with an average in place gross rent per square foot of USD26.37. Parkway owns 100 per cent of the asset and does not plan to place secured financing on the property at this time.


Subscribe to free daily newsletter
latestjobs
Quantitative Trading Strategist | Front Office

Sat, 20 Dec 2014 00:00:00 GMT

Entry Level Financial Software Developer

Sat, 20 Dec 2014 00:00:00 GMT

C#.NET Developer – Quantitative Risk, Fixed Income

Sat, 20 Dec 2014 00:00:00 GMT

events
3 weeks 2 days from now - New Orleans
4 weeks 4 days from now - Boston
4 weeks 4 days from now - New York
5 weeks 1 day from now - New York
specialreports