Lingerfelt Development buys $100 million suburban office portfolio from Liberty Property Trust
- May 12, 2011
What goes around comes around for Lingerfelt Development, and in a big way. The Richmond-based developer announced Thursday that it had bought a $100 million portfolio of 14 surburban office buildings, totaling 919,000 square feet, from Liberty Property Trust.
“We closed this afternoon,” said Alan T. Lingerfelt, a principal for the Richmond-based company.
The transaction, one of the most significant real estate sales in the Richmond market in years, brought the local developer full circle, since Lingerfelt developed many of the buildings and sold them to Liberty Property in 1995. “They are first-class properties in a first-class market,” Lingerfelt told Virginia Business. “We paid a fair price for them, $98 million, plus additional costs. It’s about a $100 million deal. In round numbers, it comes out to about $110 per square foot.”
The deal doesn’t mean that Liberty is exiting the Richmond market, said Craig Cope, vice president of Liberty’s Richmond and Hampton Roads offices. “We’re absolutely committed to the Richmond market. We’re just selling off some of our office property, and we plan to take the capital and redeploy it into buying more industrial.” This rebalancing of assets is occurring not just in Richmond, but across the country in Liberty’s 79.6 million square-foot portfolio, noted Cope. “We’re pretty heavily weighted toward suburban office, and we want to redeploy some of that money into industrial and flex.”
Lingerfelt says the deal will make his company one of the largest owners of Class A commercial real estate in the Innsbrook Corporate Center and surrounding area. The portfolio includes several buildings on Cox Road, with the largest being Liberty Plaza I, a 80,397-square-foot office. The largest building in the portfolio is Liberty Plaza II , a 135,375-square-foot bullding on Nuckols Road. Ryan Lingerfelt, another company principal, said in a statement that “this portfolio is particularly strong, since the properties are 98 percent leased, Class A commercial, and located within the desirable Innsbrook area.” The ownership transition should go smoothly, the company said, since it is retaining nearly all of Liberty’s property management staff.
In 1995, Ryan’s father, Alan, orchestrated the sale of his company, Lingerfelt Development Corp. to Liberty Property Trust, where he then served as senior vice president, for more than 12 years. “I have already been involved with these properties in an earlier life,” he noted. During that period, he oversaw the development, acquisition and management of Liberty’s Virginia region, including the properties purchased in Thursday’s transaction.
Now all the former Lingerfelt properties are part of the Lingerfelt portfolio again. Since July 1997, Alan Lingerfelt said his company will have bought or built about 2 million square feet of space, including the Liberty portfolio. Altogether, with more than 50 years in the real estate business, the Lingerfelt family has built or acquired more than 11 million square feet of commercial space. Properties range from medical to professional to industrial uses, and include data, call and emergency-care centers, elderly housing, nursing homes and multifamily developments across the eastern U.S. primarily in Virginia, North Carolina, South Carolina, Tennessee, Maryland and Illinois.
Liberty, a $6.5 billion real estate investment trust based in Malvern, Pa., is the nation’s largest publicly-traded office and industrial REIT. It still has several million square feet of industrial space in the Richmond market. Also, it still owns three suburban office properties of just under 300,000 square feet in the Boulders Office Park in south Richmond.