The 34-story, 569,000-sf Borden Building was only 71.3% occupied, the third-worst performer in the REIT's entire 41-million-sf portfolio. However, the $51 per sf was about half the appraised value three years ago, and even sharper discount to replacement value. "Our view there was to exit the Columbus market, and there was a ton of roll-over," Wold explains.
Elsewhere, Wold says investors have come looking at properties in the non-core markets, as they have been priced out of larger markets. "We've known for some time that we'd be a seller," Wold says. "For many of these properties, the time is now."
The largest non-core assets are the 1.5-million-sf Gateway Center in Pittsburgh and one-million-sf Metropolitan Square in St. Louis. The company also has two assets in Charlotte, NC totaling 1.4 million sf.
Although Trizec Properties is paying $440 million for the Bank of America Plaza in Downtown Los Angeles, president and chief executive officer Timothy Callahan says the REIT will be a net seller this year. Wold says the company could generate up to $400 million in sales over the next 12 months, on top of the $150 million the company realized in second-quarter property sales.
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