Three Transactions - $171 Million Total Asset Value
ARLINGTON, Va., May 6 /PRNewswire/ -- Charles E. Smith Residential Realty,
Inc. (NYSE: SRW), the country's leading urban multifamily real estate
investment trust, today announced three joint ventures with the J.P. Morgan
Strategic Property Fund, a commingled pension trust fund advised by J.P.
Morgan Investment Management, Inc. Each of the joint ventures involves a
separate property -- an acquisition property, a property to be developed, and
a recently-developed property. All three are located in the expanding
northern Virginia market, and they have a combined asset value of
approximately $171 million. J.P. Morgan Strategic Property Fund's total
equity commitment for the three properties is approximately $53 million; Smith
Residential's equity commitment totals $34 million.
"These joint ventures demonstrate the capital flexibility available to
Smith Residential with the quality assets in our portfolio," said John Guinee,
Smith's Chief Investment Officer. "By working jointly with a high-quality
investment partner we expand the number of investment opportunities we can
pursue, while maintaining our capital structure. These transactions extend
our market leadership position in the booming Northern Virginia high-tech
corridor. Capital flexibility of this nature further enhances our continuing
national expansion program. We are pleased to be working with J.P. Morgan
Investment Management because of its long-term ownership philosophy and
quality investment record."
The first joint venture acquired The Renaissance, a 330-unit luxury
high-rise, built in 1988, for $37 million. The property is located in Tysons
Corner, which anchors the eastern end of the fast-growing Dulles technology
corridor where there is no vacant zoned multi-family land available. The
venture is held 75% by the J.P. Morgan Strategic Property Fund and 25% by
Smith Residential. The venture placed seven-year debt financing of
$19 million at an interest rate of 6.48%.
The second joint venture will develop a new 630-unit community at
University Center in eastern Loudoun County, Virginia -- at the western end of
the Dulles technology corridor -- near Dulles airport and new headquarter
campuses presently under construction for America Online and MCI/WorldCom.
Ownership in the venture is held 60% by the J.P.Morgan Strategic Property Fund
and 40% by Smith Residential and Smith has the opportunity to enhance its
economic interest upon achieving certain hurdle returns. The venture intends
to place debt financing for 50% of the project's estimated $60 million
development cost. Construction is expected to begin within 60 days, with
final completion in 2001. Smith Residential's future equity contribution will
be approximately $6 million to fund the project through completion and
leasing.
In the third transaction, Smith Residential transferred its interest in
Springfield Station to a joint venture. Springfield Station is a 631-unit
mid-rise and garden style property in Springfield, Virginia developed by Smith
and currently in the final stages of construction and lease-up. Ownership in
the venture is held 52% by the J.P.Morgan Strategic Property Fund and 48% by
Smith. The venture placed ten-year debt financing of $37 million at an
interest rate of 6.85%. Smith Residential received financing and
reimbursement proceeds of approximately $50 million from the transaction,
which will be used to fund other projects and repay corporate debt. Since
opening for initial occupancy in May, 1998, Springfield Station has leased
extremely well, with 513 units leased as of the end of April, 1999.
Smith Residential will provide development services for the University
Center property and provide property management and leasing for all three of
the properties involved in these transactions.
Charles E. Smith Residential Realty, Inc. is a self-managed real estate
investment trust listed on the New York Stock Exchange (SRW). The Company and
its subsidiaries and affiliates own, acquire, develop, and manage multi-family
residential properties; and also provide a full range of real estate services
to other property owners. The Company owns a portfolio of approximately
20,000 apartment units, has over 3,000 units under construction and
prepurchase agreement, and manages an additional 5,000+ units for other
owners. The total market capitalization of the Company -- Charles E. Smith
Residential Realty, including its Operating Partnership -- is approximately
$2 billion. Investor information including press releases about Charles E.
Smith Residential Realty is available on the Company's Web site at:
http://www.smithreit.com , and also through PR Newswire "News on Call" by fax
800-758-5804, ext. 101271, or at: http://www.prnewswire.com .
This news release contains forward-looking statements regarding the
company's outlook, which are based on assumptions about economic and market
conditions, competitive dynamics and other factors subject to a number of
risks and uncertainties, some of which are discussed in the Company's filings
with the Securities and Exchange Commission. Actual results could differ
materially.
SOURCE Charles E. Smith Residential Realty, Inc.
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Related links:
http://www.smithreit.com
Company News On-Call: http://www.prnewswire.com or
fax, 800-758-5804, ext. 101271
CONTACT:
Media, John Kurtz, 703-769-1153, or
Investors, Greg Samay, 703-769-1029, both of Charles E. Smith
Residential Realty
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