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RALEIGH, NC-Locally headquartered Highwoods Properties Inc. has completed the $228-million sale of 2.4 million sf in 38 office buildings and 30 acres of excess land. The new owner is a joint venture of Orlando-based Capital Partners Inc. and Lehman Brothers. The properties involved in this current transaction are all of Highwoods properties in Charlotte–1.5 million sf of buildings and 28 acres of land–and all of its properties in Sabal Park in Tampa, FL– 940,000 sf in 15 buildings and two acres of land. The properties average 17 years old, have an average vacancy of 24% and generate yearly cash net operating income of $16.8 million, according to Highwoods. The land, only a portion of which is buildable, can hold about 300,000 sf of office, according to Capital Partners. Capital Partners is run by a group of people that in 1997 sold their previous Florida real estate company and its 6.5-million-sf portfolio to Highwoods for $622 million. Capital Partners’ director of acquisitions Joe Kuipers told GlobeSt.com in June, when the deal was announced, that the deal is an “opportunity to buy well-located assets in recovering markets at well below replacement cost” and will provide “attractive cash-on-cash yields.” Capital Partners is focused on becoming one of the biggest private office-space owners in the Southeast. The acquisitions will boost Capital Partners’ portfolio to 7.1 million sf of office space in Orlando, Charlotte, Atlanta, Jacksonville, Tampa, Fort Lauderdale and Tallahassee. Highwoods will clear $225 million on the deal, money it will use to repurchase and/or redeem some of its outstanding 8% preferred stock, according to its statement. Highwoods also anticipates using the proceeds to pay off a $26.2 million, 8.2% secured loan that is callable on Aug. 1, to pay down a portion of its revolving credit facility and to fund its development pipeline.

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