"Activity is very strong for early in the year," says chief operating officer Paul T. Ahern. "Institutional demand for our product is very strong."

Last year, the REIT's recycling efforts resulted in $380 million in sales with $281 million spent on acquiring new properties, a record volume. Included in the acquisitions was 1.2 million sf of vacant space, while the sales included 6.7 million sf of leased properties. The REIT plans to continue using sales proceeds to buy "value-added" opportunities.

However, the fourth-quarter acquisitions included the 3.8-million-sf Prime Group Realty Trust industrial portfolio, for $125 million. "It's nice product," Ahern says. "A lot of the product we got from Prime Group was highway frontage property. We've had a lot of good fortune with it." Those fortunes already have included leases with three tenants on 271,000 sf. Although the REIT lost one tenant, occupying 48,000 sf, but sold it a 105,000-sf building.

Meanwhile, CenterPoint officials are not fretting over the 5.5 million sf of leases expiring in 2005, representing 18% of the portfolio. "Our biggest challenge we have right now is our existing vacancy," says Ahern, whose company began the year with a 90.4% occupancy rate.

CenterPoint Properties Trust has created a new leasing department, Ahern says, as well as bolstered its due diligence staff to aid acquisitions and dispositions.

Instant Insights /

CenterPoint Hopes to Cash In On Strong Market

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