LOS ANGELES--(BUSINESS WIRE)--
Hudson Pacific Properties, Inc. (the “Company”) (HPP) today announced it has entered into a purchase agreement to acquire an office and retail property known as “Merrill Place” located in downtown Seattle’s Pioneer Square submarket, directly adjacent to the Company’s First & King property. The property is being acquired in an off-market transaction from a joint venture between Angelo Gordon, Nitze-Stagen and Mile Rock Capital for a gross purchase price of approximately $57.7 million (before closing costs and prorations). The acquisition is subject to customary closing conditions and is expected to be completed in February 2014.
Merrill Place consists of four interconnected brick and beam buildings spanning an entire city block and comprising approximately 179,000 square feet of office and ground floor retail, along with a 147-stall standalone parking structure. The property is currently 93% leased with approximately 52% of the leases scheduled to expire over the next four years. The Company estimates that in-place rents are approximately 22% below current market rents.
The Company intends to implement an extensive repositioning of the property, including lobby and common area upgrades, new tenant amenities, an elevator modernization, mechanical and electrical upgrades. Additionally, current zoning for the property allows for the potential development of a new office building fronting the soon to be improved Alaskan Way waterfront. The Company plans to commence the entitlement process immediately to allow for delivery of the new office building by 2017.
“We are very pleased to announce this opportunity to increase our footprint in the Pacific Northwest,” said Victor J. Coleman, Chairman and Chief Executive Officer of Hudson Pacific Properties, Inc. “The acquisition of Merrill Place represents an excellent opportunity for Hudson to expand in one of the fastest growing submarkets for technology tenants in Downtown Seattle and leverage our operational, leasing and development expertise to create value through an extensive repositioning and re-development of the property.”
The Eastdil Secured group of Wells Fargo Securities, LLC advised the Company and the seller on the transaction.
About Hudson Pacific Properties
Hudson Pacific Properties, Inc. is a full-service, vertically integrated real estate company focused on owning, operating and acquiring high-quality office properties and state-of-the-art media and entertainment properties in select growth markets primarily in the Pacific Northwest and Northern and Southern California. The Company’s strategic investment program targets high barrier-to-entry, in-fill locations with favorable, long-term supply-demand characteristics in select target markets, including Los Angeles, Orange County, San Diego, San Francisco and Seattle. The Company’s portfolio currently consists of approximately 6.2 million square feet, not including undeveloped land that the Company believes can support an additional 1.6 million square feet. The Company has elected to be taxed as a real estate investment trust, or REIT, for federal income tax purposes. Hudson Pacific Properties is a component of the Russell 2000® and the Russell 3000® indices. For additional information, please visit www.hudsonpacificproperties.com.
This press release may contain forward-looking statements within the meaning of the federal securities laws. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases that are predictions of or indicate future events or trends and that do not relate solely to historical matters. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and contingencies, many of which are beyond the Company’s control that may cause actual results to differ significantly from those expressed in any forward-looking statement. All forward-looking statements reflect the Company’s good faith beliefs, assumptions and expectations, but they are not guarantees of future performance. Furthermore, the Company disclaims any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. For a further discussion of these and other factors that could cause the Company’s future results to differ materially from any forward-looking statements, see the section entitled “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 filed with the Securities and Exchange Commission on March 14, 2013, and other risks described in documents subsequently filed by the Company from time to time with the Securities and Exchange Commission.
- Investment & Company Information
Hudson Pacific Properties, Inc.
Mark Lammas, 310-445-5700
Chief Financial Officer
Investor / Media Contact:
Addo Communications, Inc.
Lasse Glassen, 310-829-5400