VANCOUVER, Sept. 3, 2015 /PRNewswire/ -- City Office REIT,
Inc. (NYSE: CIO) announced today the closing of the previously
announced acquisition of the Granite 190 property in Dallas, Texas for a purchase price of
$54.35 million. Granite 190 is a
302,829 net rentable square foot Class A multi-tenant property that
is 98% leased to a variety of strong credit tenants. The
property is well located in the growing Richardson/Plano submarket of Dallas with frontage on the President George
Bush Turnpike. The Granite 190 acquisition is anticipated to
generate an initial full-year cash net operating income yield of
approximately 7.5% based on the purchase price, inclusive of free
rent credits funded by the seller at closing.
The Company also announced today that it has acquired
Intellicenter, a 203,509 square foot Class A multi-tenant property
in Tampa, Florida. Intellicenter
is a four story office building constructed in 2008 that is
currently 100% leased to various credit tenants with a weighted
average lease term remaining of 10.4 years. Intellicenter is
expected to benefit from both limited future capital requirements
given the long-term nature of its leases and its contractual annual
rental rate escalators. The property is well located on the I-75
Corridor submarket in the Tampa Telecom Park and is in close
proximity to the University of South
Florida. Intellicenter caters to large corporate tenants
that require efficient floorplates and a premium quality office
environment. The building offers impressive features such as nine
foot ceiling heights, raised access flooring with underfloor air
distribution and a desirable 5.6 per 1,000 square foot parking
ratio. The purchase price is $44.6
million (exclusive of closing costs), or $219 per square foot. The acquisition is
anticipated to generate an initial full-year cash net operating
income yield of approximately 7.3%.
In addition, as part of the transaction the Company has also
purchased an adjacent 14.1 acre development site for $2.0 million. The purchase represents a land
price of $3.26 per land foot with
153,879 square feet of zoned development potential. Given the
strategic location, the Company intends to explore both a potential
build-to-suit development as well as divesting the land in the
future. The combined purchase price of Intellicenter and the land
is $46.6 million, and is anticipated
to generate a combined initial full-year cash net operating income
yield of 7.0%.
"We are pleased with our ability to continue to acquire great
properties at attractive valuations in our target markets,"
commented James Farrar, City
Office's Chief Executive Officer. "These two purchases are
excellent examples of our strategy of acquiring well located real
estate in leading markets at attractive discounts to replacement
cost. We believe the combination of their contractual rental rate
growth combined with below market in-place rents position these
properties favorably over the long-term."
About City Office REIT, Inc.
City Office REIT is a real estate company focused on acquiring,
owning and operating high-quality (Class A and B) office properties
located in attractive target markets primarily in the Southern and
Western United States. City Office REIT currently owns or has
an interest in 3.3 million square feet of office properties.
Additional information about City Office REIT is available on the
company's website at www.cityofficereit.com. The Company
intends to elect to be taxed as a real estate investment trust for
U.S. federal income tax purposes.
Forward-looking Statements
This press release contains "forward looking statements" within
the meaning of the "safe harbor" provisions of the Private
Securities Litigation Reform Act of 1995 and other federal
securities laws. All statements that are not statements of
historical facts are, or may be deemed to be, forward looking
statements. Forward looking statements reflect our current
expectations concerning future results, objectives, plans and
goals, and involve known and unknown risks, uncertainties and other
factors that are difficult to predict and which may cause future
results, performance or achievements to differ. These
statements include, but are not limited to, those pertaining to the
Company's expectations regarding the net operating income yield of
Granite 190 and Intellicenter, the Company's ability to generate
operational efficiencies. These risks, uncertainties and other
factors include factors described in our news releases and filings
with the Securities and Exchange Commission, including our Annual
Report on Form 10-K for the year ended December 31, 2014, which has been filed with the
Securities and Exchange Commission. Readers of this press
release are cautioned to consider these risks and uncertainties and
not to place undue reliance on any forward-looking
statements. The Company does not undertake any obligation to
update any forward-looking statement, whether written or oral,
relating to matters discussed in this press release, except as may
be required by applicable securities laws.
Contact
City Office REIT, Inc.
Anthony Maretic, CFO
+1-604-806-3366
investorrelations@cityofficereit.com
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SOURCE City Office REIT, Inc.