Franklin Street Properties Expands Denver Office Portfolio
- Sep 16, 2013
By Gabriel Circiog, Associate Editor
Wakefield, Mass.-based Franklin Street Properties recently announced it has closed on the acquisition of a 20-story, multi-tenant office building and retail plaza situated in the central business district of Denver.
Featuring approximately 655,565 rentable square feet of space, the property was acquired for a purchase price of $217 million. It is located at 1001 17th Street and is currently 74 percent occupied and about 89 percent leased. The difference between the two percentages is mainly attributed to the approximately 100,000 rentable square feet of new leases that are scheduled to begin in November and December 2013.
The acquisition of the Denver property brings Franklin Street Properties’ total portfolio of directly-owned properties to 40, which vaunts a total of about 9,813,708 rentable square feet.
Prior to the acquisition confirmation the Wakefield-based REIT also announced it has closed on an unsecured term loan with a group of banks. The total borrowed amount is $220 million, but according to an accordion feature the term loan could include up to $50 million of additional borrowing capacity. The loan has a term of seven year that matures on August 26, 2020.
“We proactively decided to close this $220 million, seven-year, unsecured term loan with a fixed rate to assist us in our continuing growth plans,” says FSP President and CEO, George Carter. “We anticipate using the net proceeds of this unsecured term loan to fund a portion of our pending acquisition of 1001 17th Street, Denver, Colorado, which we expect to close on August 28, 2013. With this unsecured term loan in place, as of August 26, 2013, 100% of our total debt is unsecured, approximately 65% of our total debt is fixed and approximately 35% of our total debt is variable. We are pleased to put this unsecured term loan in place and appreciate the confidence shown in FSP by each of the participating banks.”
The acquisition of the 1001 17th Street property, is the company’s second major acquisition in recent months in Denver’s CBD. As previously reported by Commercial Property Executive, Franklin Street Properties acquired a 43-story office tower and a 9-story parking garage for a purchase price of $183 million at the end of May 2013. Located at 1999 Broadway, the property features around 680,277 rentable square feet.
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