MINOT, ND—Investors Real Estate Trust recently closed on the sale of 34 commercial office properties spread out across the Midwest for $250 million in cash, netting the Minot, ND-based company about $129 million. The sale is the first of several portfolio sales that company officials anticipate will occur in its fiscal 2016 second quarter, which began August 1, 2015. IRET plans to unload its office and retail properties and focus on other portions of its portfolio such as multifamily and healthcare.

A company official tells GlobeSt.com that the retail sale will be much smaller. According to a company document, as of April 30 it owned $2.1 billion of property, with 249 properties in 12 states, including 11,844 apartment units and 9.6 million square feet of commercial space. The retail properties were about 5.3% of the portfolio, and the office portion was 22.9%. And after IRET divests its retail and office properties, the multifamily sector will grow from 45.1% of the portfolio to 61%.

The company will reinvest proceeds from the office sale in several projects including the $56 million acquisition of a 276-unit multifamily community in Rochester, MN. It will also begin construction on a $31.5 million multifamily development in suburban Minneapolis and pay down $66 million on its line of credit.

"We are excited to be able to fully deploy our energy and focus on growing our multifamily segment,” says IRET's chief executive officer Tim Mihalick. “We see an excellent opportunity to be a best-in-class owner operator in this property segment."

According to a document filed by IRET with the US Securities and Exchange Commission, the buyer was New York-based LSREF4 Bison Acquisitions, LLC, an entity owned by Lone Star Real Estate Funds. Eighteen of the properties are in Minnesota, mostly in the Twin Cities' suburbs, eight are in Nebraska and the rest scattered across five other states.

The properties include: the Golden Hills Office Center in Golden Hills, MN; 610 Business Center IV in Brooklyn Park, MN; 7800 W. Brown Deer Rd., Milwaukee, WI; Barry Pointe Office Park, Kansas City, MO; Crosstown Centre, Eden Prairie, MN.

The company's board of trustees has also authorized a share repurchase program of up to $50 million of its common shares. "Our board of trustees and executive management strongly believe that the value of our strategy to focus the portfolio, deliver on our development plan and grow earnings with a stronger balance sheet are not reflected by the company's current stock price," says Mihalick. "This authorization demonstrates our confidence in the strength of our business and commitment to delivering shareholder value."