Rubicon Sells 14 US Offices in $515M Deal

SYDNEY, AUSTRALIA-Officials with Rubicon America Trust, based here, has signed a purchase agreement that will sell almost half of the company’s assets. The company is divesting, mostly, the 14-property GSA 1 portfolio in a $515 million sale to New York City-based UrbanAmerica. The 3.1-million-sf portfolio includes properties that are all in 14 separate US cities. The purchase was geared to the buyer’s goal of acquiring more than $1 billion in properties with secure tenants such as government entities.

The buyer is also assuming the $389 million in debt for the properties, about the only type of portfolio available today, says Richmond McCoy, president and CEO of the company. “We’ve only been looking at properties with existing debt, it’s extremely difficult to acquire or sell properties in this environment that do not have existing debt,” he tells GlobeSt.com. “There’s been a dramatic slowdown in transactions this year, and it will continue.”

The REIT will still hold a part of the portfolio. Rubicon is paying $30 million for preferred equity have some ownership interest in the portfolio. The trust said in a statement that it will use the $90 million in net sale proceeds to reduce overall borrowing.