City Office REIT to Acquire Office Property in Denver, Colorado
VANCOUVER, June 1, 2015 /PRNewswire/ -- City Office REIT, Inc. (NYSE: CIO) announced today that it has entered into an Agreement of Purchase and Sale to acquire DTC Crossroads in Denver, Colorado for a purchase price of $35 million. DTC Crossroads is a 191,402 square foot Class 'A' multi-tenant office property that is 91% occupied in the Denver Technological Center ("DTC") submarket. The acquisition is anticipated to generate an initial full-year cash net operating income yield of approximately 7.6% based on the purchase price. The major conditions to closing on the acquisition have been satisfied and the transaction is anticipated to close in July 2015. The property will be pledged as additional collateral under City Office REIT's secured credit facility.
"City Office REIT has been focused on building scale across a number of the leading submarkets in Denver. We have assembled a portfolio of great properties located downtown, the Glendale/Cherry Creek submarket, Greenwood Village and in the Northwest/Boulder submarket. Securing a high quality asset in the DTC, which has a very deep corporate tenant base, was strategic to achieve exposure in each of Denver's leading submarkets. We believe that developing this market scale will result in operating efficiencies and is a great case study for how we intend to replicate our growth in other target markets," said James Farrar, Chief Executive Officer of City Office REIT. "DTC Crossroads is an outstanding property based on a number of our key considerations. It is very well located, in great physical condition having been institutionally owned and operated, is well leased to strong corporate tenants, possesses future cash flow growth potential, and we can acquire it at a significant discount to replacement cost. DTC Crossroads was constructed in 1999 as part of the JD Edwards corporate campus and is one of the newest and highest quality assets in the DTC. It is one of the few properties in the submarket that offers a structured parking garage with underground connectivity to the office building, a desirable leasing amenity given Denver's climate. The property is situated in the heart of the DTC with a strategic corner location fronting both Interstate 25 and Interstate 225. DTC Crossroads is located a short walking distance from the Belleview Light Rail Station and desirable local amenities including adjacent hotels, restaurant alternatives and a new 1,400 unit multi-family development."
About City Office REIT, Inc.
City Office REIT is a real estate company focused on owning high-quality office properties in attractive markets primarily in the Southern and Western United States. Including previously announced acquisitions that have not yet closed, City Office REIT will own 2.7 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 DTC Crossroads, the Company's ability to generate operational efficiencies, and the Company's ability to close on DTC Crossroads and other previously-announced planned acquisitions. 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
[email protected]
SOURCE City Office REIT, Inc.
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