Brandywine Realty Announces Austin, Texas Joint Venture With DRA Advisors

(RTTNews) - Brandywine Realty Trust (BDN) said Monday it has formed a joint venture with DRA Advisors LLC. Brandywine and DRA will each own a 50% interest in the Venture that will acquire Brandywine's wholly-owned office portfolio located in the Southwest submarket in Austin, Texas. Brandywine will continue to provide property management, leasing, and construction management services.

Brandywine and DRA intend to jointly pursue additional office opportunities in targeted Austin sub-markets and plan to co-invest additional equity in acquisitions that meet certain investment criteria.

The Venture will acquire the properties from Brandywine for $330 million or $236 per square foot, representing a capitalization rate of approximately 6.7% cash and 7.0% GAAP based on current net operating income. The joint venture has secured $230.6 million of non-recourse debt through three separate mortgages that have a weighted-average maturity of 5.0 years and an expected weighted-average interest rate of 3.75%.

The transaction and related financings are expected to close early in the fourth quarter.