Vornado Realty Trust (VNO - Free Report) , a real estate investment trust (REIT), recently announced that it has inked deals to sell two properties to undisclosed buyers. The company is going to sell the Reston Executive Center located in Virginia for $126 million and another property in downtown Philadelphia for $60 million.
The company will get the combined net proceeds of $89 million from the sales after the repayment of existing loan and closing costs. Vornado Realty will earn a profit of around $70 million from the twin transactions.
Fairfax county-based Reston Executive Center is a class A three building office property and spans a total space of around 494,000 square feet. The office center is well connected to major roadways, airport and other important communication networks.
The center is around 78% leased to commercial tenants such as - VMware, Inc. (VMW - Free Report) , Genesis Partners, Inc. and New View Laser Eye Center. The second sold building is a part of a property – The Gallery at Market East – situated on Market Street in Philadelphia.
Vornado Realty is highly active on portfolio restructuring activity. Last month, the company penned an agreement with another REIT – The Macerich Company (MAC - Free Report) to sell the Green Acres Mall in Valley Stream, New York, for $500 million. Earlier this quarter, the company’s 25% owned real estate fund, Vornado Realty Capital Partners, L.P acquired a retail property named 1100 Lincoln Road for $132 million.
Vornado Realty is the largest publicly traded office REIT in the New York region concentrating on Class A office properties. The company is engaged in acquiring, owning and leasing office properties, retail space, and temperature-controlled logistics and refrigerated warehouses.
Vornado Realty is expected to release its third-quarter 2012 results on November 1. The Zacks Consensus Estimate for FFO (fund from operations) for the quarter is currently pegged at $1.17 per share.
We have a long-term Neutral recommendation on Vornado Realty. Also, it holds a short-term Zacks #3 Rank (Hold).
Note: FFO, a widely accepted and reported measure of the performance of REITs is derived by adding depreciation, amortization and other non-cash expenses to net income.