Equity Office Sheds Assets in Four Markets, Adds in Two

The two acquisitions cost $69.4 million, putting Equity Office Properties' 2005 spending at $642.6 million, much of that earmarked for 1095 Avenue of the Americas in Manhattan, a purchase expected to close in the fourth quarter.

"Our goal is to redeploy the capital and grow in our top 17 markets," says Equity Office Properties president and chief executive officer Richard Kincaid. "Our acquisitions in the Washington, DC and Sacramento markets support this strategy."

Equity Office Properties now has 942,000 sf, which is 99.2% occupied, across four properties in the Reston submarket. The Summit at Douglas Ridge II was 22% preleased when the REIT acquired the shell from the developer, Westerra Group. It has 887,000 sf, which is 93% leased, in the Roseville/Rocklin area.

The largest property in the REIT's recent round of sales was the four-building, 721,351-sf Preston Commons and Sterling Plaza, which had vacancy around 12% before being acquired by Los Angeles-based BentleyForbes Group for $135 million. However, the 545,157-sf LL&E Tower in New Orleans was 30% vacant, generating less than $6 million a year in rent.

In the Bay Area, the 218,985-sf Concar property in the San Mateo submarket was 99% occupied, generating $83.04 per sf in rental income. Meanwhile, the 40,455-sf Oak Creek II property in the San Jose submarket also was sold.

The 162,817-sf Solarium building in Denver was 88.3% occupied.