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REIT Watch: Pennsylvania REIT Pays $59.6 Million for Philadelphia Property

Whitestone Q1 Occupancy Rate Edges Down to 84 Percent, Agellan Commercial to Pay C$0.06458 in April Dividend

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United States

Pennsylvania REIT (NYSE:PEI) Pays $59.6 Million for Six-Storey Building

Pennsylvania Real Estate Investment Trust has acquired a six-storey property located on the 900 block of Market Street in Philadelphia. The building has a gross leasable area of 430,000 sq. ft. and lies between two adjacent buildings owned by the REIT. Pennsylvania RIET paid approximately $59.6 million (₤39.07 million) for the property and expects a capitalisation rate of about 5.7 percent. The acquisition was funded by cash and a $10 million (₤6.6 million) note with a five percent interest rate that can be repaid at any time.

The acquired property has 211,000 sq. ft. of office space out of which 69,000 sq. ft. is vacant and 219,000 sq. ft. of retail space with 12,000 sq. ft. unoccupied. The building has a vacancy rate of 18.8 percent.

"This is the final step in the acquisition of an assemblage of three blocks of prime real estate in Philadelphia, the nation's sixth largest MSA [Metropolitan Statistical Area]," said Joseph F. Coradino, chief executive of Pennsylvania REIT.

Barclays Capital analysts lifted their price target on Pennsylvania REIT’s shares from $17.00 to $18.00 in a research report issued to clients on Wednesday, April 17. Other analysts that have recently rated Pennsylvania REIT’s stock include JPMorgan Chase’s who gave it an “underweight rating” with a $17.00 price target and Zacks’ who upgraded their rating from “neutral” to “outperform” with a price target of $20.60.

Pennsylvania REIT’s share price fell by 2.17 percent to $18.46 in New York on Wednesday, April 17.

Whitestone Reports One Percent Drop in Q1 Occupancy Rate

Whitestone REIT (NYSE:WSR) reported on Tuesday, April 16, occupancy and leasing highlights for the first quarter ended March 31. The company had an occupancy rate of 84 percent as of March 31, down one percent from a year earlier. "During the first quarter, we made a concerted effort to continue to strengthen our tenant and revenue base by replacing tenants paying below market rental rates with stronger tenants paying higher rental rates. The timing of these replacements was the primary cause for our occupancy decrease of 1% from the previous year,” said Whitestone’s chief executive James Mastandrea.

The leasing team signed 71 leases totalling 130,897 sq. ft. during the first three months of the year and added 160 new tenants in the year to March 31, 2013. Whitestone REIT focuses on smaller space tenants with over 70 percent of the REIT’s tenants leasing less than 3,000 sq. ft.

Canada

Agellan Commercial REIT to Pay C$0.06458 per Share in April Dividend

Agellan Commercial REIT (TSE:ACR.UN) said it will pay C$0.06458 per share in dividend for April 2013. The payment will be made on May 15 to shareholders of record on April 30.

Calloway REIT

Calloway REIT said on Wednesday, April 17, that its chief financial officer Bart Munn will be leaving the company at the end of this month to become CFO of Loblaw Companies Limited’s, which is soon to create a real estate investment trust. Calloway REIT’s current vice president Mario Calabrese, who has been with the company for six years and is a Chartered Accountant, will replace Munn on an interim basis.

" Calloway’s chief executive Huw Thomas said: “The entire Calloway team remains very focused on continuing to deliver strong financial results from the Trust's exceptional portfolio of assets which have consistently delivered at or above 99% occupancy levels over the last three years."

Pennsylvania REIT’s share price was $18.46 as of 18.04.2013, 07.40 GMT.

Whitestone REIT’s share price was $15.76 as of 18.04.2013, 08.00 GMT.

Agellan Commercial REIT’s share price was C$9.57 as of 18.04.2013, 08.00 GMT.

Calloway REIT’s share price was C$28.71 as of 18.04.2013, 08.00 GMT.

 
 
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