Wells Real Estate Funds, sponsor of the unlisted Wells REIT, has officially sold 27 office and industrial properties to Lexington Corporate Properties Trust for $786 million. The deal consists of 5.1 million sq. ft. of properties. Wells REIT bought the properties between 1999 and 2003, which means that Wells is flipping many of these assets.
"These are excellent properties which have increased in value, and their sale will create significant returns for our shareholders," said Leo Wells III, president of Wells Real Estate Funds.
Wells’ decision to sell this portfolio coincides with an extremely liquid property market. The national office market ended 2004 on a positive note, too, which suggests that the recovery is well underway. REIS reports that national office vacancy ended 2004 at 16.2%, down 40 basis points for the quarter and 70 basis points for the year. That 40 basis point decline represented the largest quarterly decline in nearly five years.
The majority of the properties being sold by Wells are single tenant, Class A office buildings. Eastdil realty represented Wells in the portfolio sale.