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FORT LAUDERDALE, FL-Through a subsidiary DownREIT limited partnership, Koger Equity Inc. plans to form a joint venture with an Investcorp Properties Ltd. affiliate to acquire a partnership that owns Broward Financial Centre, a 325,000-sf, class A office building Downtown.

As a result of the deal, Investcorp would own 70% of the joint venture and Koger would own 30%. Koger would provide leasing and management of the property.

Broward Financial Centre is located at 500 E. Broward Blvd., at the southwest corner of Broward Boulevard and Federal Highway. The building, which was 88% occupied at press time, is the partnership’s only asset. The price the joint venture is paying for the partnership has an approximately 9% implied capitalization rate, based on the property’s in-place net operating income. The joint venture anticipates closing on the acquisition next January.

Currently, entities in which Thomas J. Crocker, CEO of Koger, has half ownership interest own about 14% of the partnership interests in the building. Koger’s board of directors and finance committee approved acquiring Broward Financial Centre and the terms of the deal without Crocker’s participation.

“We are pleased that we were able to form a joint venture partnership with Koger Equity, which is gaining a reputation as one of the leading class A office owners in the Southeastern United States,” John Fraser, a managing director at Investcorp, says in a statement. “We believe this relationship will allow us to expand our presence in this important market.”

Crocker adds: “With this transaction, we are pleased to re-enter the South Florida market, one of the fastest-growing regions in the country. Broward Financial Centre is a premier building in the market, with a strong credit rent roll and limited near-term rollover. It complements our strategy of acquiring in-fill locations with strong, long-term growth potential.”

The New York-based investment group Investcorp had 2002 investments of approximately $750 million. Its properties include office, industrial and multi-family properties. Koger Equity owns and operates 126 office buildings with 9.2 million rentable sf, mainly in 18 suburban office projects in 10 cities in the Southeastern US and Texas.

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