ORLANDO, FLA. — Parkway Properties (NYSE: PKY) has acquired One Orlando Centre, a 356,000-square-foot Class A office building in Orlando, and simultaneously restructured the existing first mortgage loan. The purchase price was $62 million, according to the company. The seller was undisclosed.
One Orlando Centre, known locally as the Wells Fargo building, is a 19-story office tower in the Orlando central business district. It includes an eight-story structured parking garage. Other onsite amenities include 24-hour security, full-service bank with drive-thru tellers and walk-up ATM, and a café.
The property is 81 percent occupied and generates an initial full-year cash net operating income yield of 7 percent.
Following this acquisition, Parkway Properties will own approximately 23 percent of the Class A inventory in the submarket in which the tower is located.
Parkway has taken ownership of the asset by making an $8 million equity investment. In addition to the equity investment, the existing $68.3 million first mortgage note was restructured into a new $54 million first mortgage and $16.4 million B-note.
“The acquisition of One Orlando Centre represents a creatively structured, off-market transaction that enables Parkway to strengthen its portfolio in a targeted submarket at an attractive basis,” says James Heistand, Parkway's president and CEO. “The Orlando CBD continues to show signs of an early-stage recovery in office fundamentals.”
Parkway’s stock price closed at $17.85 per share on Monday, up from $17.45 per share on April 12, 2013.
— Scott Reid