XML 31 R27.htm IDEA: XBRL DOCUMENT v2.4.0.8
Subsequent Events
9 Months Ended
Sep. 30, 2013
Subsequent Events [Abstract]  
Subsequent Events [Text Block]
SUBSEQUENT EVENTS
Austin Venture
On October 16, 2013, the Company contributed a portfolio of seven office properties containing an aggregate of 1,398,826 square feet located in Austin, Texas (the "Austin Properties") to a newly-formed joint venture (the "Austin Venture") with G&I VII Austin Office LLC (“DRA”), an investment vehicle advised by DRA Advisors LLC. The Austin Properties and related assets represent the Company's entire remaining property portfolio within the Austin, Texas region. DRA and the Company, based on arm's-length negotiation, agreed to an aggregate gross sales price of $330.0 million subject to an obligation on the Company's part to fund the first $5.2 million of post-closing capital expenditures.

DRA owns a 50% interest in the Austin Venture and the Company owns a 50% interest in the Austin Venture, subject to the Company's right to receive up to an additional 10% of distributions.
At the closing the Austin Venture obtained third party non-recourse debt financing of approximately $230.6 million secured by mortgages on the Austin Properties and used proceeds of this financing together with $49.7 million of cash contributions by DRA (less $1.9 million of closing costs and $6.9 million of closing prorations and lender holdbacks) to fund a $271.5 million distribution to the Company. The Company has agreed to fund the first $5.2 million of post-closing capital expenditures on behalf of the Austin Venture, resulting in net proceeds of $266.3 million after funding the Company's capital expenditure obligation. As part of the transaction, the Company's subsidiary management company executed an agreement with the Austin Venture to provide property management and leasing services to the Austin Venture in exchange for a market-based fee.
The Company and DRA, utilizing additional equity funding of up to $100.0 million per partner and to-be-determined third-party debt financing, intend to jointly pursue additional office opportunities in targeted Austin sub-markets and plan to co-invest in acquisitions that meet certain investment criteria.
Cira Walnut Tower

On October 31, 2013 the Company signed a lease with FMC Corporation for approximately 245,000 square feet of office space at the Cira Walnut Tower ("Cira Walnut"), which is an office and residential tower that the Company will develop at 30th and Walnut Streets in Philadelphia on a site ground leased from the University of Pennsylvania. The lease with FMC has an initial term of sixteen (16) years from initial occupancy. In addition, the Company also leased approximately 100,000 square feet of office space to the University of Pennsylvania under a twenty-year lease. Cira Walnut will be known as The FMC Tower at Cira Centre South.

The Company's ground lease with the University of Pennsylvania has a term through July 2097, with a variable rent that would provide the University with a percentage of the cash flow or proceeds of specified capital events subject to receipt by the Company of a priority return on the Company's investment.
The Company has evaluated subsequent events through the date the financial statements were issued.