Thomas Properties Group Announces Closing of the Liquidation of TPG/CalSTRS Joint Venture
October 01 2013 - 1:12PM
Business Wire
Thomas Properties Group, Inc. (NYSE: TPGI) announced today that
it and the California State Teachers' Retirement System (“CalSTRS”)
have completed the liquidation of their joint venture, TPG/CalSTRS,
LLC (“TPG/CalSTRS”). As a result of this liquidation, Thomas
Properties has acquired all of CalSTRS’ 75% interest in both San
Felipe Plaza and CityWestPlace in Houston, Texas and CalSTRS has
acquired all of the interests in City National Plaza in Los
Angeles, California. Thomas Properties previously held a 25%
interest in each of the Houston properties and an approximately 8%
interest in City National Plaza, through its interest in
TPG/CalSTRS.
The liquidation was effected pursuant to the Redemption and
Liquidation Option Agreement, dated as of July 16, 2013 (the
“Option Agreement”). On September 30, 2013, (a) Thomas Properties
made a capital contribution to TPG/CalSTRS of $163.8 million,
subject to normal closing adjustments (the "Contribution Amount"),
(b) TPG/CalSTRS made a distribution to CalSTRS of all of the
interests in the entity that owns City National Plaza in Los
Angeles, California, plus cash equal to the Contribution Amount,
and (c) TPG/CalSTRS made a distribution to Thomas Properties of all
of the interests in the entities that own San Felipe Plaza and
CityWestPlace. Three properties in Virginia (Fair Oaks Plaza and
Reflections I and II), which had been owned by TPG/CalSTRS and are
subject to special servicer oversight, were sold separately by
TPG/CalSTRS on September 27, 2013, and therefore were not
distributed to TPG under the Option Agreement.
“The liquidation of TPG/CalSTRS represents the culmination of a
very successful partnership between our company and CalSTRS,” said
James A. Thomas, Chairman and CEO. “Over the past 10 years, our
joint venture acquired and repositioned 23 properties consisting of
more than 10 million square feet that generated outstanding returns
to both CalSTRS and Thomas Properties. We are pleased to remain in
partnership with CalSTRS in our Austin venture, which continues to
own 5 of the best CBD office buildings in Austin.”
The Houston assets now wholly owned by Thomas Properties are
comprised of over 2.5 million square feet of Class A office space
in some of the strongest submarkets of Houston. CityWestPlace is a
35 acre, four-building highly amenitized complex totaling 1.5
million square feet, located 12 miles west of downtown in the
WestChase submarket. San Felipe Plaza is a 45-story, one million
square foot tower located in the San Felipe/Voss submarket. Both
properties provide convenient access to popular residential areas,
major transportation corridors, and both of the city’s major
airports.
Thomas Properties also announced that on September 27, 2013, it
borrowed $80 million (the “Parkway Loan”) from an affiliate of
Parkway Properties LP pursuant to a Loan Agreement, dated as of
September 4, 2013 (the “Loan Agreement”), between Thomas Properties
and Parkway Properties LP which was entered into in connection with
the Agreement and Plan of Merger dated as of September 4, 2013 by
and among Parkway Properties, Inc., Parkway Properties LP, PKY
Masters, LP, and Thomas Properties. The Parkway Loan bears interest
at a rate of 6% per annum for the first six months, 8% per annum
for the following six months, and 12% per annum thereafter. The
Parkway Loan will mature on January 15, 2015. Thomas Properties may
prepay the Parkway Loan at any time without penalty. TPG used the
proceeds from the Parkway Loan, together with available cash, to
fund its capital contribution under the Option Agreement.
About Thomas Properties Group
Thomas Properties Group, Inc., is a full-service real estate
company that owns, acquires, develops and manages primarily office,
as well as mixed-use and residential properties on a nationwide
basis. The company's primary areas of focus are the acquisition and
ownership of premier properties, both on a consolidated basis and
through its strategic joint ventures, property development and
redevelopment, and property management and leasing activities. For
more information about Thomas Properties Group, Inc., please
visit www.tpgre.com.
Forward Looking Statements
Statements made in this press release that are not historical
may contain forward-looking statements which are based on TPGI’s
current expectations and assumptions. Such forward-looking
statements include, but are not limited to, statements about the
benefits of the agreements recently entered into by TPGI. Although
TPGI believes the expectations reflected in any forward-looking
statements are based on reasonable assumptions, these statements
are subject to numerous risks and uncertainties. Factors that could
cause actual results to differ materially from TPGI’s expectations
include TPGI’s ability to obtain lender consent to such
transactions, actual and perceived trends in various national and
economic conditions that affect global and regional markets for
commercial real estate services (including interest rates), the
availability of credit and equity investors to finance commercial
real estate transactions, our ability to enter into or renew leases
at favorable rates, which can be impacted by the financial
condition of our tenants, risks associated with the success of our
development and property redevelopment projects, general volatility
in the securities and credit markets, and the impact of tax laws
affecting real estate. For a discussion of some of the factors that
may cause our results to differ from management’s expectations, see
the information under the captions “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” in our Form 10-K for the year ended December 31, 2012
and our subsequent Form 10-Q quarterly reports, each of which is
filed with the Securities and Exchange Commission. TPGI disclaims
any intention or obligation to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Investor relations contact:Thomas Properties GroupDiana
Laing, Chief Financial Officer213-613-1900
Thomas Properties Grp., Inc. (NYSE:TPGI)
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