Pacific Plans 403,000 SF of Acquisitions

Pacific Office was formed via the contribution of the Shidler Group's Western US office building portfolio and certain investment operations to a newly formed operating partnership of Arizona Land Income Corp. and the merger of Arizona Land with its wholly owned subsidiary, Pacific Office Properties Trust Inc. Pacific Office Properties, which was the surviving entity in the merger, as part of its formation was granted the option to acquire certain properties that Shidler owned or had under contract.

The acquisition of the seven buildings in San Diego and Phoenix will increase Pacific Office's portfolio by approximately 17% from 2.4 million leasable sf to 2.8 million sf. These seven are part of 18 office buildings totaling 1.9 million sf that Pacific Office has an option to acquire under the terms of its recently completed formation. The 18 buildings are located in the REIT's markets of Honolulu, San Diego, Phoenix, Los Angeles and Orange County.

Pacific expects to acquire the seven buildings in two separate transactions that are scheduled to close next month, with each of the transactions subject to customary closing conditions, and each of the buildings to be owned in partnership with an institutional investor. Financial terms of the transactions were not disclosed. Shidler paid $24.3 million for the Black Canyon Corporate Center last year, according to a GlobeSt.com report at the time of the sale. The property, located in the Deer Valley submarket of Phoenix, stands on a 19-acre site, which could accommodate additional office development, Pacific Office notes in its announcement regarding the acquisitions.

Pacific Office plans to adopt the Shidler Group's strategy of institutional joint-venture initiatives, through which it acquires, owns, and operates value-added properties in Honolulu, San Diego, Los Angeles, and Phoenix in partnership with institutional investors. The company's president and CEO is Dallas E. Lucas, an industry veteran who most recently served as EVP and CFO of Maguire Properties. Pacific's chairman is Jay H. Shidler, founder and managing partner of the Shidler Group.