Real Estate
Kranzco Realty preferred stock on ratings alert
Philadelphia Business Journal - by Natalie Kostelni
Fitch IBCA, the rating service, has placed a rating alert on Kranzco Realty Trust's preferred stock in light of its merger with CV Reit, a deal that creates an umbrella partnership real estate investment trust called Kramont Realty Trust.
Kranzco's stock now has a double-B rating and may be affirmed, upgraded or downgraded after Fitch meets with Kramont's new senior managers and reviews its financing and operating plans. Fitch said it will also look into plans to achieve improvements in Kranzco's portfolio that have not been accomplished independently and CV Reit's property and mortgage portfolio. CV Reit does not have any preferred stock outstanding.
Shareholders of both companies will receive one share in the new company for each share owned in either company. The new company, which plans to continue investing in community and neighborhood shopping centers, will increase diversity through a larger portfolio of 84 centers totaling 11 million square feet.
Keystone buys warehouse
Keystone Property Trust acquired a 407,000-square-foot bulk distribution warehouse in Carlisle for $16 million. The building is fully leased for 10 years to Dana Corp., a supplier to vehicle and engine manufacturers.
The West Conshohocken real estate investment trust bought the warehouse from 21 Roadway, a limited partnership controlled by Jeffrey E. Kelter, Keystone's president and chief executive, and several other of the REITs employees. The building, located at the intersection of several major interstates, was constructed in 1988 and purchased by 21 Roadway in 1997.
The transaction was approved by a special subcommittee of the REIT's board of directors created specifically to review this transaction. The purchase was funded with $2.5 million in cash, $1.4 million of the company's stock and the remainder in loans.
Toll earnings through roof
Riding the wave of a booming housing market, Toll Brothers Inc. had a banner fourth quarter and fiscal year, reporting record numbers in earnings, revenues, contracts signed and backlog. This marked the company's seventh consecutive year of record earnings and eighth consecutive year of record revenues.
For the fourth quarter, the Huntingdon Valley luxury homebuilder reported $33.4 million or 90 cents per diluted share in earnings, a 20 percent increase over the same quarter last year. For its fiscal year ending Oct. 31, Toll had $103 million or $2.75 per diluted share in earnings. Revenues for the year stood at $1.46 billion, a 21 percent increase over last year. Fourth-quarter revenues were also strong, coming in at $442.9 million, an 18 percent jump over the same period last year.
The company's first six weeks of fiscal 2000 also appears to be outpacing the same period last year. So far, the company has experienced a 30 percent increase in deposits and a record backlog of nearly $1.07 billion. Toll noted that demand is outstripping supply in several of its affluent markets and home prices have also increased. Based on this, the company projects that next year and 2001 will be record years.
The fine print
Liberty Property Trust received zoning approval from East Whiteland Township to build a 6-story, 200,000-square-foot office building, full service hotel and two restaurants on 60 acres at the intersection of Routes 202 and 29 ... Assessment Systems Inc. signed a 10-year, $20 million lease on 64,681square feet at Three Bala Plaza in Bala Cynwyd for its headquarters. The company provides licensing and certification services and is a division of Harcourt General Inc. Insignia/ESG represented the tenant ... Markward Group sold a 200,000-square-foot flex building at 589 Phoenixville Pike, Malvern, to Lend Lease Real Estate. Terms of the deal were not disclosed. The building is fully occupied ... Lawndale Realty Inc. in Northeast Philadelphia merged its 12-agent firm with Coldwell Banker Diamond Realty Services, which has about 175 agents. Terms of the merger were not disclosed ... Warner Bros. Music Group has a 151,000-square-foot warehouse on 13 acres in the Pureland Industrial Complex in Bridgeport, N.J., up for sale for $6.5 million.
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