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ATLANTA-Birmingham, AL-based REIT Colonial Properties Trust has completed a joint venture, sale and long-term management agreement with UBS Wealth Management for Colonial Center at Mansell Overlook. The transaction was valued at $166.4 million with a cap rate of 7.1%.

Colonial Center consists of four, six-story class A office buildings, five low-rise buildings and two street-front boutique retail shops. The 877,000-sf office park is 98% leased and has three sites available for future office and retail development.

Under the agreement, Colonial Properties Trust will retain a 15% interest in the joint venture with UBS for the four class A office buildings, two retail properties and three development sites. UBS will assume 100% ownership of the five low-rise buildings. Colonial Properties will maintain operational management and leasing of the entire park through a long-term management and leasing contract. “This transaction with UBS exemplifies Colonial Properties’ corporate strategy of recycling capital,” says Tom Hallowell, Colonial Properties’ senior vice president, office division. “UBS recognized Colonial Properties’ ability to create tremendous value from developing a high-quality suburban office park in a high-growth submarket of Atlanta.”

Net proceeds to Colonial Properties for the transaction were $142.4 million, of which $16.5 million was used to pay off a secured loan, $74.7 million was reinvested in additional property acquisitions and the remaining $51.2 million was used to reduce the company’s outstanding unsecured line of credit. Colonial Properties was represented by Eastdil Secured in the transaction and UBS was represented by AEW Capital Management LP.

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