SAN DIEGO, Dec. 29 /PRNewswire-FirstCall/ -- In one of the largest office
deals in Hawaii's history, San Diego-based The Shidler Group has acquired a
two-building, 550,000-square-foot office portfolio from the California State
Teachers' Retirement System for $90 million.  The purchase includes the Davies
Pacific Center and the Pan Am Building.
    The Davies Pacific Center is a 22-story, 346,619-square-foot "Class A"
office building located at 841 Bishop Street in Honolulu's Central Business
District.  The property occupies a full city block and is strategically
located between First Hawaiian Center, Pacific Guardian Center, Bank of
Hawaii, City Financial Center and Topa Financial Center.
    Major tenants include New York Life Insurance Company, Oshima Chun Fong
and Chung, Hopaco, Boise Cascade Office Products Corp., Bendet, Fidell, Sakai
& Lee, and Citizens Communications Co.  The building's occupancy level is
currently 87%.
    The Pan Am Building is a 17-story, 203,910-square-foot multi-tenant office
building located at 1600 Kapiolani Boulevard, just east of Honolulu's Central
Business District and west of Waikiki, within Honolulu's world famous
Kapiolani Corridor.  The Pan Am Building is the largest office building in its
submarket.
    Major tenants in the Pan Am Building include ISDI, Decision Research
Corp., American Savings Bank, the State of Hawaii Department of Accounting and
General Service, Atlantis Submarines, and Office Pavilion.  The occupancy
level is currently 91%.
    The seller, California State Teachers Retirement System, acquired the two
properties in 1989 at a price of $145 million and has invested significant
capital during its ownership.
    Matt Root, a Partner of The Shidler Group, said, "This is The Shidler
Group's first large-scale office purchase in Hawaii in nearly 10 years.
Acquiring these trophy properties in the prestigious and convenient Central
Business District represented an unprecedented opportunity to acquire nearly
5% of the total Honolulu office market and nearly 10% of the 'Class A' Central
Business District market in one transaction."  Root added, "This is also an
opportunity to acquire institutional-quality office buildings at 50% of
replacement cost at the bottom of the market cycle, with trends pointing to an
imminent economic recovery."
    Root cited several statistics indicating the potential strength of the
rebound:

     -- Moody's Investors Service recently selected Hawaii as the best
        commercial real estate market in the United States.
     -- The Honolulu office vacancy rate, at 13.8 percent, is below the
        national average and likely to improve.
     -- Hawaii's Gross State Product (GSP) has increased by an average of 3.5%
        per year for the past three years compared to an average 1% increase
        nationally.
     -- Hawaii's unemployment rate of 4.4% is the lowest in the nation and 27%
        below the 6% national average.
     -- Increased federal defense spending, up 21% between 2000 and 2002 and
        46% in 2003, is beginning to be felt at the local level in Honolulu.
        Department of Defense spending in Hawaii totals 9.4% of GSP.

    Root noted other recent purchases by The Shidler Group in Honolulu that he
said were part of the firm's long-term commitment to investing in the state.
These transactions included the purchase of Bay View Golf Park and The Shops
at 2150 Kalakaua in August 2003 and The Waikiki Galleria retail and office
building in November 2001.
    Stephen Silk and Jay Borzi of Secured Capital Corporation and Jamie Brown
of Hawaii Commercial Real Estate represented both sides of the transaction.
    Greenwich Capital provided financing for Davies Pacific Center and UBS
provided financing for the Pan Am Building.

    The Shidler Group is a national real estate organization that actively
acquires commercial real estate for its own account.  It currently owns and
operates over 8 million square feet of commercial property throughout Texas,
Arizona, Hawaii and Southern California.  Since its founding in 1972, The
Shidler Group and its affiliates have facilitated the acquisition of over 130
million square feet of commercial property.
    The western regional headquarters of The Shidler Group is located at 10188
Telesis Court, Suite 222, San Diego, California, 92121.  For more information,
contact Matt Root at (858) 678-8500, Ext. 239.

    For further information, please contact Matt Root of Shidler Group,
+1-858-678-8500, ext. 239; or Dan Peoples, +1-858-552-1456, for Shidler Group.

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