Non-traded REIT, KBS Real Estate Investment Trust III (KBS REIT III) has entered into a purchase and sale agreement to acquire an office property in Atlanta, Georgia, according to an SEC filing. The property, located at 171 17th Street, contains 509,237 rentable square feet and is situated on 0.7 acres.
The contractual purchase price of the property is $132.5 million plus closing costs. The company intends to fund the purchase price with proceeds from its offering in addition to proceeds from a mortgage loan from an unaffiliated lender.
Built in 2004, the 22-story property was approximately 89% leased to 11 tenants as of July 29, 2014. The current aggregate annual effective base rent for the tenants is approximately $10.5 million and the current weighted-average remaining lease term for the tenants is approximately 6.6 years.
Wells Fargo leases about 68% of the available space according to Cassidy Turley, a commercial real estate service company who also rents offices in this building.
Sponsored by KBS, KBS REIT III seeks to invest in and manage a portfolio of high quality commercial real estate assets, consisting primarily of Class A office towers, in high job growth markets nationwide.
As of March 31, 2014, the company had sold 80,584,260 shares of common stock for gross offering proceeds of $801.7 million. The offering is expected to close in September 2015.