Winthrop Advances Liquidation Plan

BOSTON—Winthrop Realty Trust on Monday said it has sold seven assets in separate transactions across the US and has three more under contract. Spanning multifamily, retail and office, the sales are in accordance with the plan of liquidation that the REIT's shareholders approved this past summer.

The deals announced Monday include Winthrop's Waterford Place apartment property in Memphis and a San Pedro, CA multifamily building from the ST Residential Luxury portfolio in which the REIT holds an 84% interest; a 50% interest in an office property at 223 W. Jackson Blvd. in Chicago and a 32% share of the venture that owns an office at 5400 Westheimer Ct. in Houston; a pair of retail properties net leased to the Kroger Co. in Greensboro, NC and Atlanta; and a B-note with an outstanding principal balance of $5 million. The San Pedro sale netted $23.1 million, which was used to pay down a $150-million loan from KeyBank National Association; net proceeds from the other sales totaled $39.9 million.

Additionally, Winthrop has the 502,000-square-foot office property at 1515 Market St. in Philadelphia under contract for $35.5 million, as well as its share of an office portfolio in northwest Atlanta that it owns in a venture with Sealy & Co., from which the REIT expects to realize $5.5 million. There is also a Louisville, KY retail property that is triple-net leased to Kroger under contract for $2.3 million. Winthrop expects these sales to close by year's end.

This past April, Winthrop's board agreed on a plan of liquidation over a two-year period, which shareholders approved in August.  After exploring other options that included seeking a merger with another real estate company, the board opted to liquidate, in part because its stock continued to trade at a discount to the value of the underlying assets. Further, CEO Michael Ashner told the Wall Street Journal in April, the REIT saw few opportunistic deals in a recovering property market.

“I don't see real relative investment value in the real estate space,” Ashner told the WSJ. “Margins have compressed.” In a statement announcing the liquidation plan this past April, Ashner said the decision was “the best and most efficient means of realizing our underlying value for our shareholders.”