PS Business Parks, Inc.
), a real estate investment trust (REIT) that owns and operates
commercial real estate properties across the U.S., has recently
augmented its Texas portfolio with the acquisition of three
multi-tenant flex buildings spanning 226,000 square feet. The
properties were purchased from an unnamed seller for $14.9
The acquired properties are presently 86.1% leased, with an
average leased space of 21,600 square feet. The buildings are
strategically located adjacent to the parks that are already
owned by the company. With the current purchase, PS Business
Parks would have 1.7 million square feet of multi-tenant flex
space in its kitty in Austin, spread across nine separate
PS Business Parks owns low-rise suburban multi-tenant offices,
business parks and industrial and flex assets. Located mostly in
high population markets, flex properties are a combination of
warehouse and office space and can be easily configured to suit a
variety of uses.
The warehouse component of the flex space is primarily used for
purposes such as light manufacturing and assembly, storage and
warehousing, showroom, laboratory, distribution and research and
development activities. The office component of the flex space is
complementary to the warehouse component and enables businesses
to accommodate management and production staff in the same
Over the years, PS Business Parks has focused on investing and
owning real estate in diversified markets, thereby tapping
multiple industry concentrations and minimizing the risks
associated with the economic down cycles. In addition, the
company seeks to maximize its cash flow by controlling capital
expenditures associated with re-leasing space by acquiring and
owning properties, which can be easily reconfigured to suit a
variety of uses for a wide range of tenants.
The wholly-owned portfolio of the company as of December 19,
2012, included 28.3 million rentable square feet of industrial
and flex space. The portfolio is well spread out in eight states
and is currently leased to approximately 4,600 customers.
We maintain our Neutral recommendation for PS Business Parks,
which presently has Zacks #3 Rank that translates into a
short-term Hold rating. We also have a Neutral recommendation and
Zacks #3 Rank for
First Industrial Realty Trust Inc.
), a competitor of PS Business Parks.
FIRST INDL RLTY (FR): Free Stock Analysis
PS BUSINESS PKS (PSB): Free Stock Analysis
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