Legendary buyer Wells Real Estate Funds is about to make good on a pledge to sell off a massive piece of its REIT portfolio. The Wells REIT is expected to sell $1 billion worth of office and industrial properties to New York-based Lexington Corporate Properties Trust (LXP). Unlike Wells, LXP is a listed REIT. If LXP successfully buys the entire portfolio, it would boost its size from $1.5 to $2.5 billion.

Late in December 2004, Wells chief executive officer Leo Wells announced his intention to sell more than $1 billion worth of properties that the REIT had acquired in a buying spree between 1998 and 2003. He also simultaneously waived the REITs share redemption program until the sale is completed.

It’s believed that Lexington could buy the entire portfolio on its own without any joint venture partners. The portfolio includes 32 office and industrial properties with a total of 6.5 million sq. ft. of space. Most of the office properties are leased to single tenants with good credit. The average lease term on the properties is 8 years, with no rollover until 2009.

High-end sales brokerage Eastdil is handling the sale. A spokeswoman for Wells Real Estate Funds declined to comment on the sale.