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ROCKVILLE, MD. — Washington Real Estate Investment Trust (WRIT) (NYSE: WRE) has entered into four separate contacts with a single buyer to sell a 100 percent interest in its medical office portfolio and two office assets for nearly $501 million. The purchase price for the portfolio, which contains approximately 1.5 million square feet, equates to $329 per square foot.
“Over the past decade, we have methodically grown our medical office portfolio into becoming one of the largest landlords of institutional-quality medical office properties in the Washington, D.C., metro area,” says George “Skip” McKenzie, president and CEO of Rockville-based WRIT. “With the completion of the medical office portfolio sale, we will be successfully exiting this business line, which has been extremely profitable for us over the past decade.”
The portfolio includes 17 medical office buildings and two suburban office properties, 6565 Arlington Blvd. and Woodholme Center. Also included is a parcel in Alexandria, Va., which is being used as off-site/overflow parking for one of the medical office assets in the portfolio.
In January, WRIT announced the proposed sale of the portfolio as a strategic opportunity to streamline the company’s business operations. With the disposition of the medical office portfolio, WRIT will focus exclusively on its core office, multifamily and retail properties.
The sale will be structured as four independent transactions, each of which will close pursuant to its own purchase and sale agreement. The projected closing date for the first two transactions is Nov. 12, 2013, and the outside closing date for the final two transactions is Jan. 31, 2014.
The company plans to use the proceeds to reinvest in high-quality downtown or metro-centric office buildings, and well-located retail and multifamily assets. A small portion will also be used to reimburse WRIT for costs associated with defeasance and repaying $23 million of existing loans on the portfolio.
WRIT is a self-administered, self-managed, equity real estate investment trust that focuses on income-producing properties in the greater Washington, D.C., area. WRIT owns a portfolio of 69 properties totaling 8 million square feet and 2,540 multifamily units. The company’s stock price closed at $25.14 per share on Friday, down slightly from $25.66 per share a year ago.
— Brittany Biddy