Prime Income, the Dallas-based real estate arm of the Gene E. Phillips Children's Trust, has had the 22-story building under contract since April with the Calgary-based REIT. According to TGS REIT, net proceeds came to $14.4 million after paying off the mortgage and returning part of RTBM Holding Co.'s initial investment from a $200-million office and retail portfolio buy in 2002.
At closing, the 600 E. Las Colinas Blvd. footprint was 89% leased; its leads are Archon Group LP and JPI, both headquarters tenants. Peloton Real Estate Partners of Dallas will continue to lease the 30-tenant building while Regis Management Co., a Prime Income affiliate, has taken over management duties from TGS' in-house team.
Archon Group presents the biggest risk since its 130,000-sf headquarters pact will expire in June 2007. Corporate execs have Jeff Ellerman with Dallas-based Staubach Co. already scouting the terrain for 200,000 sf, but playing the game as would be expected by also negotiating to stay rooted in a high rise that it once owned.
JPI, the multifamily development giant, occupies 100,000 sf in the 4.8-acre, canal-fronting asset. Its lease doesn't expire until 2015.
TGS REIT is in the midst of selling all that it owns in the US. Earlier this month, it hawked two outlet centers in Colorado. The REIT lobbed a play for US assets in 2002 with a $425-million pool, but ended up with only two Texas deeds. The REIT paid $52.75 million for 600 Las Colinas to Archon and its New York City partner, Whitehall Funds, and within weeks laid down $24.5 million to Westbrook Partners, also from New York City, for 396 West Greens, a 186,791-sf, class A high rise near Bush Intercontinental Airport in Houston.
"With the completion of this sale and the previously announced sale of the two outlet centers in Colorado, the REIT is now focused on its Canadian portfolio and the orderly disposition of the remaining US assets," Jeff Kohn, TGS REIT's CEO, says in a press release about last Friday's closing.
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