U.S. Landlord Winding Up its Australian REIT
Tishman Speyer Properties in New York is buying out its affiliated Australian REIT that has ownership in 16 office buildings across the United States in markets including New York, Philadelphia, Washington DC, Chicago, Milwaukee, San Francisco, Los Angeles and Seattle.
Sydney, Australia based Tishman Speyer Office Fund owns 99.9% of four office buildings totaling 893,000 square feet and 45.9% ownership in another 12 totaling 7.46 million square feet.
Tishman Speyer Office Fund will be wind up its U.S. property holdings by agreeing to sell the portfolio for $1.5 billion plus an expected $48.5 million towards its transaction costs. The buyer is a joint venture of Tishman Speyer Properties and an international pension fund. The unnamed fund will put up $800 million of the transaction cost. Tishman Speyer Properties has already been managing the U.S. portfolio and will continue to do so.
As of the end of the 2011, Tishman Speyer Office Fund reported that more than 55% of all outstanding units were currently held, directly or indirectly, by U.S. residents. That threshold of U.S. ownership meant that starting in October of this year, the Australian REIT would have to register its common units with the U.S. Securities & Exchange Commission and would be subject to U.S. reporting and disclosures rules.
"The consequences of becoming a U.S. domestic reporting company are significant and burdensome, with consequential increases in costs to meet enhanced reporting and compliance obligations," the Australian company said.
If the sale goes through to Tishman Speyer Properties and its new investment partner, the company will no longer have to make any public disclosures in the U.S. or Australia.
Properties involved in the ownership transfer include: 300 Park Ave. and CitySpire in New York; Greenwich American Centre in Greenwich, CT; Bala Plaza in Philadelphia; 227 West Monroe and 222 West Adams in Chicago; Plaza East I and II in Milwaukee; 520 Pike Tower in Seattle; One Bush Street and 595 Market Street in San Francisco; Bayside Towers in Foster City, CA; 400 Castro Street in Mountain View, CA; Lakeside in Northern Virginia; and Maples Plaza, 407 North Maple Drive and Beverly Mercedes Place in Beverly Hills, CA.
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