Liberty Property Trust Sells $969M Portfolio

By Gail Kalinoski

1 Country View Road, Malverne, Pa.

PhiladelphiaWorkspace Property Trust, a privately held commercial real estate company specializing in the development, management and operation of office and flex space, has completed the purchase of a nearly $1 billion portfolio from Liberty Property Trust.

The addition of 108 buildings and 26.7 acres of land in five markets across the United States is the second significant real estate transaction by WPT this year—and also the second involving Liberty, which has been selling off its non-core suburban assets. WPT’s partners in this acquisition, announced in late July, are global investment firm Safanad Ltd. and affiliates of Square Mile Capital, a New York-based real estate investment firm.

The acquisition expands WPT’s portfolio to 149 properties totaling roughly 10 million square feet. The Horsham, Pa.-based firm has acquired more than $1.2 billion of assets in less than a year. The first acquisition of 41 Liberty properties in the Horsham area occurred in December 2015, as the firm began its plan of building a portfolio of superior, well-positioned suburban real estate assets.

WPT is a partnership among Rizk Ventures, Safanad, Square Mile Capital, Forum Partners, JMP Group and EverWatch Capital. It is run by industry veterans Thomas Rizk and Roger Thomas. Forum Partners, JMP Group and EverWatch Capital were WPT’s partners on the first acquisition.

FTI Consulting, Eastdil Secured and JMP Securities were advisors to WPT on the latest transaction. J.P. Morgan Securities LLC served as advisor to Liberty.

“We are pleased to join WPT, its existing capital partners and Safanad in this high-quality and diversified portfolio acquisition,” Elliot Rattner, Square Mile principal, said in a prepared statement. “Square Mile invests using a value-oriented approach to commercial real estate assets through alignment with likeminded and institutional sponsors.

The latest acquisition from Liberty comprises 30 properties in the Malvern/Chesterbrook, Pa., area with 2,075,764 square feet; 34 in Tampa, Fla., with 1,799,568 square feet; 11 properties in South Florida with a total of 1,135,410 square feet; 19 in Minneapolis with 1,488,832 square feet; and 14 in Phoenix with 1,078,652 square feet.

The assets are part of the Safanad Suburban Office Partnership with total market value of more than $1.3 billion.

“Safanad’s approach to investing aligns very well with Workspace Property Trust’s vision and strategic pan of building a strong overall portfolio in vibrant markets,” Kamal Bahamdan, CEO & founder of Safanad, said in a prepared statement. “We have great confident that our partnership with Tom and Roger will create tremendous value in these suburban office assets.”

Thomas, president, COO & founding principal, described the assets as “well, maintained, and well-located” and said the “exceptional acquisition adds tremendous growth and potential to our platform.”

Rizk, CEO & founding principal, called the acquisition exciting and said it was “a key step in establishing our platform for investment in high-quality suburban office properties in select markets.”

The firm has also hired roughly 50 new employees to expand its business.

“The addition of Safanad, with its management in worldwide investments, and Square Mile, which along with its affiliates, has approximately $15 billion of assets under management, provides the financial strength to continue building our portfolio,” Rizk said in prepared remarks.

Liberty said the disposition of the properties, which totaled 7.6 million square feet, was consistent with its plan to sell at least $1 billion in non-core suburban properties this year. With this sale, Liberty has surpassed that goal with 2016 dispositions totaling $1.2 billion. Liberty, based in Malverne, Pa., now has a 96 million-square-foot portfolio which includes 566 office, distribution and light manufacturing facilities throughout the U.S. and United Kingdom.

Image courtesy of Nave, Newell Inc.

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