Highwoods Properties,
Inc. HIW has acquired its joint venture partner's 57%
interest in Glenlake North and South Towers, two Class A, 10-story
office buildings with structured parking, for a purchase price of
$45.4 million. Located in Atlanta's Central Perimeter submarket with
excellent access to GA 400, the properties, encompassing 505,000
square feet, are valued at $80.6 million, including $1.0 million of
planned near-term building improvements. This equates to a total
asset value of $159 per square foot, a 30+% discount to estimated
replacement cost. The Company's total incremental investment is
expected to be $46.0 million.
The following table sets forth details regarding the transaction ($
in millions):
Real Estate Value 100% 57%
-------- --------
Purchase Price $ 79.6 $ 45.4
Near-Term Building Improvements 1.0 0.6
-------- --------
Total Investment $ 80.6 $ 46.0
======== ========
Equity Value
Purchase Price $ 79.6 $ 45.4
Less Debt -37.6 -21.4
-------- --------
Equity $ 42.0 $ 24.0
======== ========
The properties are 82% leased and are expected to generate full-year
cash and GAAP net operating income of $5.1 million and $6.0 million,
respectively. Approximately $0.2 million of acquisition costs will be
expensed in the third quarter.
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