Cousins Declares $356M Special Cash Dividend

"Our strategy this year was to take advantage of the substantial investor appetite for high-quality office assets," says Cousins president and CEO Tom Bell. "In the process, we were able to shrink our asset base to a level that should provide better overall returns to our shareholders over time, as we continue to develop new assets."

Bell says "this strategy has served Cousins well for many years and we are proud to provide this large special dividend to our deserving shareholders." He adds, "These sales serve as another example of how we create value through development, grow value through leasing and management, and actively manage our investment portfolios, harvesting that value at opportune times."

Bell notes that under the REIT provisions of the Internal Revenue Code, substantial gains must be distributed in order for the company not to incur corporate level taxes. "The board and management determined that, due to our strong financial position, an all-cash distribution was in order," he says.

Bell notes that "based on current estimates of 2004 taxable income and gains, approximately 77% of the distribution should be taxed at the 15% federal capital gain rate, with approximately 23% being taxed at the 25% federal recapture rate." He adds, "Of course, these estimates may change."

Properties Cousins disposals this year included two office buildings and eight ground leases, all at Wildwood Office Park in Atlanta sold to a fund managed by UBS Realty Investors LLC for $247.5 million in October; John Marshall II, a 224,000-sf office building in Tysons Corner, VA, sold to an affiliate of ING Realty Partners for $59.3 million, also in October; 101 Second St. and 55 Second St., both in San Francisco, sold to an affiliate of Hines for $287 million in September; and two medical office buildings, Northside/Alpharetta I at 103,000 sf and Northside/Alpharetta II at 198,000 sf, sold to Northside Hospital for $41.4 million in November.

Cousins also disposed of Four Wildwood Office Park buildings sold to Wells REIT for $172.5 million in September; Buildings III and IV at Austin Research Park in Austin, TX, sold to a private equity fund for $78.7 million in September; the Pinnacle and Two Live Oak, both in Atlanta, sold to TIAA-CREF for $200 million in August; 101 Independence Center, a 526,000-sf office building in Charlotte, NC, sold to American Financial Realty Trust for $100 million in July; and 333 John Carlyle and 1900 Duke St., both in Alexandria, VA, sold to Grosvenor USA Ltd. for $80 million in May.