Yesterday, Liberty Property Trust (LRY) – a hybrid real estate investment trust (REIT) – unveiled its plan to construct an office building for The Vanguard Group in Malvern, Pa. The total value of the project is estimated to be $55 million. The development project is aligned to meet the previously announced outlook for full year 2013.
In early Dec 2012, Liberty Property provided guidance for 2013 FFO per share in the range of $2.60–$2.70. The guidance reflected an expected increase in overall occupancy along with organic growth through increased development opportunities.
For the construction, Vanguard inked a long-term lease deal with Liberty Property, which was represented by Jones Lang LaSalle Incorporated (JLL). Liberty Property will develop the office building at Great Valley Corporate Center – a 41 years old business park community. The construction of the 200,000 square foot, six-story office building will begin in Mar 2013 and is expected to complete by mid-2014.
Great Valley Corporate Center comprises offices and Research and Development space spanning 5 million square feet. Strategically positioned in historic Chester County, the corporate center is well connected to major highways such as Route 202 High-Tech Corridor and Pennsylvania Turnpike. The center boasts a class of leading tenants like Microsoft Corporation (MSFT) and Centocor – an operating arm of Johnson & Johnson (JNJ).
Liberty Property boasts a strong portfolio of multi-tenant industrial and office properties in prime business locations in the U.S., and operates across multiple markets that enable mitigation of geographical risk. We expect the abovementioned transaction to further strengthen Liberty Property’s tenant base and boost its top-line growth going forward.
Liberty Property currently holds a Zacks Rank #4 (Sell).
Note: FFO, a widely used metric to gauge the performance of REITs, are obtained after adding depreciation and amortization and other non-cash expenses to net income.
JONES LANG LASL (JLL): Free Stock Analysis Report
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