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Parkway Inks Deal to Sell 80% Interest in Courvoisier Centre

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In sync with its capital recycling strategy, Parkway Properties Inc.PKY , the Orlando, FL-based real estate investment trust ("REIT"), recently inked a deal to divest 80% interest in Courvoisier Centre. The 346,000-square foot and two-building office complex, situated in Brickell submarket of Miami, will fetch a gross value of $175 million. Going forward, this divestiture is expected to create substantial value, supporting Parkway's growth. The REIT has also updated its outlook range for 2016 Funds from Operations ("FFO").

Parkway is engaged in acquisition, ownership, management, financing and leasing of office properties in the Southeastern U.S. and Texas. Notably, Courvoisier Centre is a Class A office complex which was acquired by Parkway in Apr 2014 for $145.8 million. Subject to fulfillment of customary closing conditions, the divestiture is expected to close in the first quarter of 2016.

Taking into account the recapitalization of Courvoisier Centre, Parkway has revised its 2016 FFO outlook to a range of $1.28-$1.38 per share. The 2016 recurring cash net operating income ("NOI") outlook has also been narrowed to $210,500-$215,500 from the previous guidance of $216,000-$221,000.

Parkway currently has a Zacks Rank #4 (Sell).

Investors interested in the REIT industry may consider stocks like Extra Space Storage Inc. EXR , Mack-Cali Realty Corp. CLI and Alexandria Real Estate Equities, Inc. ARE . While both Extra Space Storage and Mack-Cali sport a Zacks Rank #1 (Strong Buy), Alexandria Real Estate holds a Zacks Rank #2 (Buy).

Note: Funds from operations, a widely used metric to gauge the performance of REITs, is obtained after adding depreciation and amortization and other non-cash expenses to net income.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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