MELVILLE, N.Y.--(BUSINESS WIRE)--Dec. 20, 2005--Reckson Associates
Realty Corp. (NYSE: RA) today announced the sale of 100 Wall Street, a
463,000 square foot office building located in New York City, for
approximately $134 million, or $290 per square foot.
100 Wall Street, an operating asset held outside Reckson's core
midtown Manhattan holdings, has substantial near-term rollover with
approximately 85,000 square feet, net of space already committed,
expiring over the next 12 months.
Reckson will report a GAAP gain of approximately $46.4 million on
the sale. The tax gain of approximately $43.5 million from the sale of
this property has been deferred as part of a like-kind (1031) exchange
in conjunction with the Company's purchase of Reckson Plaza, a 1.1
million square foot, Class A trophy office complex, located in
Uniondale, Long Island acquired in October of 2005.
Reckson has provided the purchaser with a mezzanine loan in the
amount of $30.0 million that will bear interest at 15% per annum, has
a term of two years and an approximate 85% loan-to-cost.
In conjunction with this transaction, Reckson obtained a release
of the existing mortgage on 100 Wall Street and provided two of the
Companies suburban office properties as replacement collateral.
Commenting on the transaction, Scott Rechler, Reckson's President
and Chief Executive Officer, said, "The sale of 100 Wall Street is
consistent with our strategy of selling assets in our non-core
markets. 100 Wall Street was acquired at the time of our original
investment in New York City. Since that time, we have concentrated the
growth of our New York City portfolio in the strong midtown Manhattan
submarket." Mr. Rechler continued, "During 2005, we have 'match
funded' approximately $1.3 billion of investments with approximately
$900 million of non-core asset dispositions neutralizing the impact of
assets acquired at current cap rates by selling assets at prices that
reflect the same cap rate environment."
Michael Maturo, Reckson's Executive Vice President and Chief
Financial Officer, stated, "This transaction is consistent with our
balance sheet strategy to recycle capital by selling assets where we
have created significant value. Our successful capital recycling
activities provide us with significant flexibility and capacity to
fund the Company's future growth initiatives with proceeds and
profits."
Reckson Associates Realty Corp. is a self-administered and
self-managed real estate investment trust (REIT) specializing in the
acquisition, leasing, financing, management and development of Class A
office properties.
Reckson's core growth strategy is focused on the markets
surrounding and including New York City. The Company is one of the
largest publicly traded owners, managers and developers of Class A
office properties in the New York Tri-State area, and wholly owns, has
substantial interests in, or has under contract, a total of 103
properties comprised of approximately 20.1 million square feet. For
additional information on Reckson Associates Realty Corp., please
visit the Company's web site at www.reckson.com.
Certain matters discussed herein, including guidance concerning
the Company's future performance, are "forward-looking statements"
within the meaning of the Private Securities Litigation Reform Act of
1995. Although the Company believes the expectations reflected in such
forward-looking statements are based on reasonable assumptions,
forward-looking statements are not guarantees of results and no
assurance can be given that the expected results will be delivered.
Such forward-looking statements are subject to certain risks, trends
and uncertainties that could cause actual results to differ materially
from those expected. Among those risks, trends and uncertainties are
the general economic climate, including the conditions affecting
industries in which our principal tenants compete; financial condition
of our tenants; changes in the supply of and demand for office
properties in the New York Tri-State area; changes in interest rate
levels; changes in the Company's credit ratings; changes in the
Company's cost of and access to capital; downturns in rental rate
levels in our markets and our ability to lease or re-lease space in a
timely manner at current or anticipated rental rate levels; the
availability of financing to us or our tenants; changes in operating
costs, including utility, real estate taxes, security and insurance
costs; repayment of debt owed to the Company by third parties; risks
associated with joint ventures; liability for uninsured losses or
environmental matters; and other risks associated with the development
and acquisition of properties, including risks that development may
not be completed on schedule, that the tenants will not take occupancy
or pay rent, or that development or operating costs may be greater
than anticipated. For further information on factors that could impact
Reckson, reference is made to Reckson's filings with the Securities
and Exchange Commission. Reckson undertakes no responsibility to
update or supplement information contained in this press release.
CONTACT: Reckson Associates Realty Corp.
Scott Rechler, CEO
Michael Maturo, CFO
Phone: 631-694-6900
Fax: 631-622-6790
or
Rubenstein Communications
Media:
Rick Matthews, 212-843-8267
SOURCE: Reckson Associates Realty Corp.
