TORONTO-IPC US REIT, a Canada public company that invests only in US real estate, is selling a 780,000-sf portfolio of five shopping centers for $94 million as it capitalizes on the high demand for retail and reinvests the proceeds into office properties. The sale, which went under contract earlier this week, is expected to close before the end of the year. The buyer has not yet been revealed.

Net of debt, closing adjustments and sales costs, the cash proceeds to the REIT will be $43 million. The estimated pre-tax profit is $13 million.

The properties being sold include Hurstbourne Forum Shopping Center, a 134,963-sf property in Louisville that is 97.8% leased; Brittany Retail Center, a 214,148-sf property in Witchita, KS, that is 78.3% occupied; Normandie Village, a 91,306-sf property in Witchita that is 84.5% occupied; Comotara Center, a 55,488-sf property in Witchita that is 100% leased; and Walpole Mall, a 282,000-sf property in East Walpole, MA, that is 95.6% leased.

The pending sale was announced along with the company’s third quarter earnings report. IPC says it has only one retail property left, a 94,000-sf mall that is being redeveloped as part of the company’s 400,000-sf Hurstbourne Town Center development.

IPC says its distributable income for the third quarter rose 12.9% to $9.5 million in the third quarter. On a per unit basis, distributable income fell to $0.224 from $0.23 due to higher utility costs in its same-store portfolio and reduced occupancy caused by a tenant bankruptcy and a lease expiration. Net operating income was $21.8 million and rental revenue was $40.1 million in the third quarter. The totals are 12.9% and 24.2% higher, respectively, than the third quarter of 2004.

Earlier this year, ABFS, a 235,000-sf tenant in its 60% owned 1.5 million-sf Wanamaker Building in Philadelphia went bankrupt and vacated its premises. IPC received $4.2 million from a letter of credit in the second quarter. In August, Sony’s 123,000-sf lease in its Tice property expired without a renewal. IPC says it has so far released 40% of the space, though some of the leases have not yet commenced.

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