Rogers adds the Jackson, MS-based REIT, which bought the 1.1-million-sf building in the Illinois Center complex for $172.3 million in 2001, has collected earnest money but it remains refundable. While declining to identify the potential partner, Rogers indicates it will be a long-term, passive investor. "Opportunistic partners, we're just not talking to them any more," he adds.

Parkway Properties sold a 70% joint venture interest to New York-based Investcorp International Inc. for $125 million in 2003 but bought it back for nearly $140 million last year. Company officials report the property is generating $18.3 million a year in net operating income, is 94.9% leased, but has 13 leases totaling 61,000 sf expiring this year. The building's largest tenant, Young & Rubicam, can reduce its 122,078 sf by 34,000 sf as early as November. The 30-story building is mortgaged for $98 million at a 7.21% interest rate, and Parkway Properties could face a $13-million pre-payment penalty.

Parkway Properties intends to use proceeds from the sale of a joint venture interest to buy more office properties for its own portfolio or a partnership with an Ohio pension fund.