Parkway Signs 213,000 Square Feet Of New And Expansion Leases In Houston
ORLANDO, Fla., Dec. 17, 2014 /PRNewswire/ -- Parkway Properties, Inc. (NYSE:PKY) announced today that it has signed two leases totaling 213,000 square feet in Houston, Texas with Nabors Industries and Bristow Group Inc.
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"These two leases help to quickly mitigate some upcoming known move-outs in our Houston portfolio with little to no downtime," stated James R. Heistand, President and Chief Executive Officer of Parkway. "Having recently signed a strategic long-term renewal with Nabors Industries, we were also able to accommodate their expansion needs while immediately backfilling a pending vacancy at One Commerce Green. Additionally, the Bristow Group lease allows us to backfill space being vacated by Halliburton at CityWestPlace at significantly higher current market rents compared to current in-place rents for that space. As a result of these leases, our Houston portfolio is currently approximately 94% leased, and we have mitigated some of our exposure to near-term expirations in Houston."
"I am very pleased with recent leasing velocity in Houston, which remains a dynamic core market for Parkway," stated M. Jayson Lipsey, Executive Vice President and Chief Operating Officer of Parkway. "Our local operating team has continued to drive value through accretive lease deals. Based on recent leasing activity, we have reduced lease expirations as a percent of the overall Houston portfolio to an average of approximately 9.5% per year over the next five years. Additionally, we have unlocked considerable NOI growth in the process, highlighted by the positive mark-to-market of approximately 66% on the recently executed Bristow lease at CityWestPlace. "
Nabors Industries signed a 98,000 square foot expansion lease at One Commerce Green, located in the Greenspoint submarket of Houston, that expires on September 30, 2025. The Nabors expansion will immediately back-fill space that Southwestern Energy Company will vacate during the first quarter of 2015. Bristow Group Inc. signed a 115,000 square foot new lease at CityWestPlace, located in the Westchase submarket of Houston, that expires on January 31, 2025. The Bristow lease will back-fill known move-outs at CityWestPlace of approximately 39,000 square feet of 2014 expirations and approximately 76,000 square feet of 2017 expirations.
As of December 17, 2014, Parkway's Houston portfolio has approximately 418,000 square feet of 2015 lease expirations, which represents 9.5% of its total Houston portfolio. Included in the 2015 Houston expirations is 101,000 square feet associated with the expiration of Southwestern Energy Company's lease at One Commerce Green, which has been largely backfilled by the Nabors expansion. Excluding the Southwestern Energy Company lease expiration, Parkway's Houston portfolio has approximately 317,000 square feet expiring in 2015, representing approximately 7.2% of its Houston portfolio.
As of December 17, 2014, Parkway's Houston portfolio has approximately 588,000 square feet of 2016 expirations, which represents 13.4% of its total Houston portfolio. Of the total 2016 Houston expirations, 306,000 square feet is space that BMC Software, Inc. will vacate at CityWestPlace in January 2016, with expiring rates that are considerably below current market rates for that property. Excluding the BMC Software contraction, Parkway's Houston portfolio has approximately 282,000 square feet expiring in 2016, representing approximately 6.4% of its Houston portfolio.
Parkway estimates a positive mark-to-market potential of approximately 27% on its 2015 Houston expirations and 34% on its 2016 Houston expirations.
About Parkway Properties
Parkway Properties, Inc. is a fully integrated, self-administered and self-managed real estate investment trust specializing in the acquisition, ownership, development and management of quality office properties in higher growth submarkets in the Sunbelt region of the United States. At October 1, 2014, Parkway owned or had an interest in 52 office properties located in eight states with an aggregate of approximately 18.5 million square feet of leasable space. Fee-based real estate services are offered through wholly-owned subsidiaries of the Company, which in total managed and/or leased approximately 10.6 million square feet for third-party owners at October 1, 2014.
Forward Looking Statements
Certain statements in this press release that are not in the present or past tense or that discuss the Company's expectations (including any use of the words "anticipate," "assume," "believe," "estimate," "expect," "forecast," "guidance," "intend," "may," "might," "outlook," "project", "should" or similar expressions) are forward-looking statements within the meaning of the federal securities laws and as such are based upon the Company's current beliefs as to the outcome and timing of future events. There can be no assurance that actual future developments affecting the Company will be those anticipated by the Company. Examples of forward-looking statements include projections relating to 2014 fully diluted EPS, share of depreciation and amortization, gain on sales of real estate, reported FFO per share, recurring FFO per share, nonrecurring items, net operating income, cap rates, internal rates of return, dividend payment rates, FFO accretion, capital improvements, expected sources of financing, the timing of closing of acquisitions, the ability to dispose of non-core properties, dispositions or other transactions and descriptions relating to these expectations. These forward-looking statements involve risks and uncertainties (some of which are beyond the control of the Company) and are subject to change based upon various factors including, but not limited to, the following risks and uncertainties: changes in the real estate industry and in performance of the financial markets; the actual or perceived impact of U.S. monetary policy; competition in the leasing market; the demand for and market acceptance of the Company's properties for rental purposes; oversupply of office properties in the Company's geographic markets; the amount and growth of the Company's expenses; customer financial difficulties and general economic conditions, including increasing interest rates, as well as economic conditions in the Company's geographic markets; defaults or non-renewal of leases; risks associated with joint venture partners; risks associated with the ownership and development of real property, including risks related to natural disasters; risks associated with property acquisitions; the failure to acquire or sell properties as and when anticipated; termination or non-renewal of property management contracts; the bankruptcy or insolvency of companies for which the Company provides property management services or the sale of the related properties; the outcome of claims and litigation involving or affecting the Company; the ability to satisfy conditions necessary to close pending transactions and the ability to successfully integrate businesses compliance with environmental and other regulations, including real estate and zoning laws; the Company's inability to obtain financing; the Company's inability to use net operating loss carry forwards; the Company's failure to maintain its status as a real estate investment trust, or REIT, under the Internal Revenue Code of 1986, as amended; and other risks and uncertainties detailed from time to time in the Company's SEC filings. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, the Company's business, financial condition, liquidity, cash flows and financial results could differ materially from those expressed in the Company's forward-looking statements. Any forward-looking statement speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict the occurrence of those matters or the manner in which they may affect us. The Company does not undertake to update forward-looking statements except as may be required by law.
Contact:
Ted McHugh
Director of Investor Relations
(407) 650-0593
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/parkway-signs-213000-square-feet-of-new-and-expansion-leases-in-houston-300011143.html
SOURCE Parkway Properties, Inc.
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