Partnership will allow Columbia to increase scale in its top markets on
a leverage-neutral basis, with attractive cost of capital
NEW YORK & SAN FRANCISCO--(BUSINESS WIRE)--
Columbia
Property Trust, Inc. (NYSE: CXP) and Allianz Real Estate today
announced that they have completed the formation of a joint venture to
acquire and manage Class-A office properties located in select gateway
markets in the United States.
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333 Market Street in San Francisco is one of three properties contributed to a joint venture announced today between Columbia Property Trust and Allianz Real Estate. (Photo: Business Wire)
The two companies have initially contributed three unencumbered
properties to the joint venture that have a combined gross asset value
of $1.26 billion, and the venture plans to acquire additional Class-A
office properties in select gateway markets in the United States.
Columbia contributed two of its properties in the San Francisco Bay
area. These include University Circle, a 451,000-square-foot office
complex in Palo Alto valued at $540 million, which Columbia acquired in
2005, and 333 Market Street, a 657,000-square-foot office tower in the
Financial District valued at $500 million, which Columbia acquired in
2012.
Allianz also simultaneously contributed 114 Fifth Avenue, a
352,000-square-foot office building in Manhattan valued at $220 million
that Allianz has owned since 2015 along with its 1% partner, L&L Holding
Company. Fully-leased to a strong roster of tenants, this landmark
office asset is located in the vibrant Flatiron District of Midtown
South and offers attractive historic architecture, tall ceilings and
large floorplates throughout the building. The 19-story tower provides
sweeping cityscape views and has few approaching capital needs,
following a recent $45 million investment in infrastructure and
contemporary renovations.
As a result of these transactions, Allianz now owns a 22.5% interest in
University Circle and 333 Market Street, while Columbia owns 77.5% and
will continue to oversee property management and leasing at these two
properties, as well as management of day-to-day operations of the joint
venture. At 114 Fifth Avenue, Columbia and Allianz each own 49.5%, while
L&L retains its general partnership stake and will continue as the
property management and leasing agent for this Midtown South building.
Within the next twelve months, Allianz will increase its ownership
interest in both University Circle and 333 Market Street to 45%, thereby
adjusting Columbia’s ownership percentage in these two properties to 55%
and self-funding the venture for Columbia.
“Our joint venture with Allianz is the right vehicle for increasing
scale within our core markets,” said Nelson
Mills, president and chief executive officer of Columbia Property
Trust. “This partnership allows us to increase market presence without
issuing stock or raising leverage, and we have found an ideal partner in
Allianz, which shares our investment outlook and disciplined, long-term
approach to investing. Additionally, with these transactions, we realize
a portion of the substantial value we have created within our portfolio.”
“This opportunity reflects the goal of our U.S. team to pursue
high-quality, long-term investments with partners that share our vision
and ability to create value,” said Christoph Donner, chief executive
officer, Allianz Real Estate of America. “In addition to an alignment of
our investment strategies, the combination of our highly-experienced and
knowledgeable teams of investment and asset management professionals
will support growth in the portfolio of our joint investments over time.
Columbia is a nimble, long-term investor and the formation of this joint
venture further evidences that Allianz is a capital partner capable of
seamless execution.”
About Columbia Property Trust
Columbia Property Trust (NYSE: CXP) owns and manages Class-A office
buildings primarily in high-barrier-to-entry, primary markets. Its
portfolio includes 16 operational properties containing eight million
square feet, concentrated in New York, San Francisco, and Washington,
D.C. Columbia carries an investment-grade rating from both Moody’s and
Standard & Poor’s. For more information, please visit www.columbia.reit.
About Allianz Group
The Allianz Group is one of the world's leading insurers and asset
managers with 86 million private and corporate customers. In 2016, more
than 140,000 employees in over 70 countries achieved a total revenue of
€122.4 billion euros and an operating profit of €10.8 billion. As at the
end of 2016, the Allianz Group managed an investment portfolio amounting
to €653 billion. In addition, our asset managers AllianzGI and PIMCO
managed assets equivalent to €1.3 trillion euros for third parties.
Allianz customers benefit from a broad range of insurance services,
ranging from property and health insurance to assistance services to
credit insurance and industrial insurance. With its investments, Allianz
is active in numerous sectors, such as bonds, shares, infrastructure,
real estate and renewable energy. The Group pursues long-term and
value-generating strategies whilst giving consideration to return and
risk aspects.
About Allianz Real Estate
Allianz Real Estate is the strategic center of expertise in real estate
within the Allianz Group and a leading international real estate
investment and asset manager. Allianz Real Estate develops and executes
worldwide tailored portfolio and investment strategies on behalf of the
Allianz companies, considering direct as well as indirect investments
and real estate loans. The operational management of investments and
assets is currently performed in 7 international subsidiaries and hubs
in Germany, France, Switzerland, Italy, Spain/Portugal, USA and
Asia/Pacific. The headquarters of Allianz Real Estate are located in
Munich and Paris. Allianz Real Estate has approximately €50 bn assets
under management.
About Allianz Real Estate of America
Allianz Real Estate of America is responsible for equity and commercial
mortgage loan investments in the Americas. Allianz Real Estate of
America, based in New York, has a portfolio of over $14 billion (€13
billion) with its holdings diversified across more than 30 metro markets
and property types spanning office, multi-family, retail, and industrial.
Forward-Looking Statements:
Certain statements contained in this press release other than
historical facts may be considered forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. We intend for all such
forward-looking statements to be covered by the applicable safe harbor
provisions for forward-looking statements contained in those acts. Such
statements include, in particular, statements about our plans,
strategies, anticipated dividends, and prospects and are subject to
certain risks and uncertainties, including known and unknown risks,
which could cause actual results to differ materially from those
projected or anticipated. Therefore, such statements are not
intended to be a guarantee of our performance in future periods. Such
forward-looking statements can generally be identified by our use of
forward-looking terminology such as "may," "will," "expect," "intend,"
"anticipate," "estimate," "believe," "continue," or other similar words.
Readers are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. We make no representations or warranties (express or
implied) about the accuracy of any such forward-looking statements
contained in this press release, and we do not intend to publicly update
or revise any forward-looking statements, whether as a result of new
information, future events, or otherwise.
Any such forward-looking statements are subject to risks,
uncertainties, and other factors and are based on a number of
assumptions involving judgments with respect to, among other things,
future economic, competitive, and market conditions, all of which are
difficult or impossible to predict accurately. To the extent that our
assumptions differ from actual conditions, our ability to accurately
anticipate results expressed in such forward-looking statements,
including our ability to generate positive cash flow from operations,
make distributions to stockholders, and maintain the value of our real
estate properties, may be significantly hindered. See Item 1A in the
Company's most recently filed Annual Report on Form 10-K for the year
ended December 31, 2016, for a discussion of some of the risks and
uncertainties that could cause actual results to differ materially from
those presented in our forward-looking statements. The risk factors
described in our Annual Report are not the only ones we face, but do
represent those risks and uncertainties that we believe are material to
us. Additional risks and uncertainties not currently known to us or that
we currently deem immaterial may also harm our business.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170706006183/en/
Columbia Property Trust
Media Contact:
Bud Perrone,
212-843-8068
bperrone@rubenstein.com
or
Investor
Relations:
Matt Stover, 404-465-2227
IR@columbia.reit
Source: Columbia Property Trust