In the joint venture, Prentiss is teaming with an unidentified German insurance company on 8260 Greensboro Dr. and 1676 International Dr., a trophy office structure, in Tysons Corners. And, says August, that partner is looking to invest another $60 million to $75 million this year in US properties. The joint venture is locked down until Dec. 31, 2004, which Prentiss officials had said is just fine by them.

In a press release, August says the swap enables the REIT "to continue to narrow its focus to the markets where we believe that we have the strongest competitive advantage and where we have the ability to add the most value." In the past year, Prentiss has been unloading non-strategic office properties and industrial holdings nationwide in a strategy to capture a "pure office" market share in fewer markets where it has "a competitive advantage."

August says the asset swap had been investigated prior to its failed merger with Mack-Cali. When that went down the tubes, Brandywine president and CEO Gerard H. Sweeney had called Prentiss to renew talks. The two have been prepping for the swap since December.

According to August, Prentiss had looked at several options for the disposition. "Trying to sell that as a whole would have been impossible," he says. The asset swap carries far less disruption than a piecemeal sell-off, he had contended, describing the deal as "the best execution possible."

The swap's announcement had been put out late Wednesday followed yesterday by Prentiss declaring a 48.5 cents per share dividend for the first quarter. Prentiss will be able to reduce its debt by $83 million this year and another $3 million come 2002. That, with other sales, will chop off between $980 million and $990 million of the REIT's $1.1 billion debt. Ernst says the bottom line is that Prentiss will have about $23 million that must be reinvested. The immediate "pressure on earnings" will equate to two cents per share, but that is expected to ease in the fourth quarter, according to Ernst's calculations.