Parkway Properties, Inc. (NYSE: PKY
) has agreed to acquire NASCAR Plaza, a 390,000-square-foot office tower in the CBD of Charlotte, NC, from a joint venture of Trinity Capital Advisors and Rubenstein Partners.
The 20-story building constructed in 2009, which is 88% leased with an average in-place rent per square foot of $25.61, sold for about $100 million. It is located next to the NASCAR Hall of Fame and the racing association has leased 139,000 square feet in the building for its headquarters under a lease that runs through May 2021.
"The purchase of NASCAR Plaza represents another off-market transaction that enables us to expand in one of our key, target submarkets with a high-quality asset," said James R. Heistand, Parkway's president and CEO, adding the REIT plans to grow leasing and rents in a submarket that it believes will outperform during a recovery.
NASCAR Plaza is expected to generate a 2013 estimated cash net operating income of approximately 7%. Parkway will own the entire asset and plans to assume the first mortgage secured by the property, which has a current outstanding balance of approximately $42.3 million with a current interest rate of 4.7% and a maturity date of March 30, 2016.
After closing, Parkway intends to amend and restate the loan to current market terms. Closing is expected by the end of the year and Parkway intends to fund its share of equity using cash and borrowings from its revolving credit facility.