Highwoods Properties, Inc., (HIW), a real estate investment trust recently acquired 4201 Lake Boone Trail, a 48,000-square-foot, three-story medical office building in Raleigh. The total outlay is $ 9.0 million which includes near-term capital expenditures.
Highwoods is now the owner of eight medical office buildings spanning 338,000 square feet and 93.9% leased located across the street from Rex Hospital.
The three-story medical office building in the first year of its operations is expected to generate net operating income of $ 700,000 excluding $ 76,000 for acquisition expenses. At present the medical office building is 94.3% occupied.
This acquisition is a strategic move by Highwoods to strengthen its portfolio in one of Raleigh’s best locations. With seven other buildings owned by Highwood already located across the street from Rex Hospital, this acquisition further places it in an excellent position to provide medical office space to a number of physicians and allied services who want to build their relationship and take advantage of being located close to the Hospital. Rex Hospital has over 1100 physicians and is a member of the UNC health care family.
Highwoods is a real estate investment trust that owns or has management interests in office, industrial, retail and service center properties, including development projects and apartment units across the U.S. As of December 31, 2010, Highwoods owned or had interest in 330 in-service offices, industrial holdings and retail properties spanning approximately 32.4 million square feet. Additionally, Highwoods also owned 611 acres of development land.
Highwoods currently retains a Zacks #2 Rank, which translates into a short-term Buy rating. We are also maintaining our long-term Neutral recommendation on the stock. One of its competitors, Duke Realty Corp. (DRE) currently retains a Zacks #2 Rank, which translates into a short-term Buy rating.
DUKE REALTY CP (DRE): Free Stock Analysis Report
HIGHWOODS PPTYS (HIW): Free Stock Analysis Report
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