Highwoods Acquires Advance Auto Parts Tower
Highwoods Properties, Inc. (NYSE:HIW) has made a significant move by agreeing to acquire the Advance Auto Parts Tower, a prime 20-story office building in Raleigh. This impressive structure, comprising 346,000 square feet, is renowned for its Class AA rating and LEED-gold certification. Since its completion in 2020, this tower has maintained a stellar 100% lease occupancy rate as of the end of last year, indicating a robust demand for quality office space in the area.
Strategic Location
Located in Raleigh's bustling North Hills Best Business District (BBD), the tower's proximity to Highwoods-owned CAPTRUST Tower adds strategic value to the acquisition. CAPTRUST Tower is a 16-story facility offering 300,000 square feet of office space, currently boasting a 98.4% occupancy rate, reflecting the high demand in this vibrant commercial hub.
Financing the Acquisition
To fund this acquisition, Highwoods will utilize a leverage-neutral strategy, drawing on the proceeds from the recent divestment of non-core assets located in Tampa. This approach underlines the company's commitment to maintaining a balanced financial structure while pursuing growth opportunities in key markets.
Comments from Leadership
Ted Klinck, President and CEO of Highwoods, expressed enthusiasm about the new addition, stating, "We are excited to expand our presence in the vibrant North Hills mixed-use BBD with the addition of Advance Auto Parts Tower. Our nearly 650,000 square feet of office positions us to benefit from the strong demographics that have attracted many businesses, residents, and guests to North Hills specifically, and Raleigh overall." He noted that this acquisition aligns with Highwoods' strategy to enhance portfolio quality while being immediately accretive to cash flows.
Details of the Acquisition
The acquisition of Advance Auto Parts Tower is subject to customary closing conditions and is expected to be finalized within the next 30 days. Highwoods is prepared to post earnest money deposits amounting to $20 million, which will be non-refundable except under specified circumstances, illustrating the company's commitment to this strategic move.
About Highwoods Properties
Highwoods Properties, Inc. is a leading office real estate investment trust (REIT) headquartered in Raleigh. The company manages a diverse portfolio of properties across some of the most sought-after business districts in cities such as Atlanta, Charlotte, Dallas, and Nashville. Highwoods aims to revolutionize commercial real estate by creating inspiring environments for both their clients and employees, enhancing the overall experience in the workplace.
Frequently Asked Questions
What is the significance of acquiring Advance Auto Parts Tower?
The acquisition enhances Highwoods' presence in a key business district, aligning with their strategy to grow in vibrant markets with strong demographics.
How will Highwoods finance the acquisition?
Highwoods plans to finance the acquisition using proceeds from the recent sale of non-core assets, ensuring a leverage-neutral financing strategy.
What does this acquisition mean for tenants?
This acquisition signals high-quality office space availability in a sought-after location, which could attract new tenants and businesses to the area.
When is the closing date for the acquisition?
The acquisition of Advance Auto Parts Tower is expected to close within the next 30 days, pending customary closing conditions.
Who can I contact for more information about Highwoods?
For inquiries, you can contact Brendan Maiorana, the Executive Vice President and Chief Financial Officer, at brendan.maiorana@highwoods.com or via phone at 919-872-4924.
