|  Acquisition Criteria February 2010
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Since beginning our focus on office property investment in 1995, Parkway has acquired $2.1 billion of real estate in the Southeastern and Southwestern United States, and Chicago, representing a total of 87 office properties encompassing 17.8 million rentable square feet. The majority of Parkway's investments were completed with cash at closing, through either fee-simple or discretionary fund formats.
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The diversity of Parkway's investment formats provides us with an ability to close investments in a wide range of market conditions. Most recently, Parkway has pursued a strategy of investing primarily through discretionary investment funds. Parkway benefits from the fund strategy through an increased return on investment from fee income, greater diversification through smaller equity investments in larger properties, full investment and operating discretion, and longer hold periods that provide more durable returns than traditional joint ventures.
| | Parkway Properties Office Fund, L.P. (PPOF) | |
In 2005, Parkway created its first discretionary investment fund with the Ohio Public Employees Retirement System (OPERS) for the purpose of acquiring high-quality, multi-tenant office properties in the United States. Parkway and OPERS committed a total of $200 million in equity capital on a 25% and 75% basis, respectively. As of February 2008, Parkway completed its investment on behalf of the fund in 13 office properties or 2.7 million rentable square feet located in seven existing Parkway markets. The total invested capital of PPOF is approximately $500 million.
| | Parkway Properties Office Fund II, L.P. (PPOF II) | |
In May 2008, Parkway created its second discretionary investment fund with the Teachers Retirement System of Texas (TRS) for the purpose of acquiring high-quality, multi-tenant office properties in the United States. Parkway and TRS committed a total of $375 million in equity capital on a 30% and 70% basis, respectively. Parkway will pursue investments in existing Parkway markets and new growth markets during an initial four year investment period. PPOF II has the ability to make investments on an all-cash basis and will place leverage on its investments subsequent to closing. PPOF II must meet a minimum 10% leveraged internal rate of return hurdle net to its limited partners. Once fully-invested, PPOF II is expected to have total invested capital of approximately $750 million.
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Parkway will invest in office properties on behalf of PPOF II meeting the following criteria:
| | Assets | Class A to A- multi-tenant, multi-story office properties located in CBD and suburban markets | | Size: | Greater than 125,000 SF in Parkway existing markets and greater than 250,000 SF in new markets | | Occupancy: | Greater than 60% leased, with adequate rent roll diversification | | Markets: | Atlanta, Austin, Charlotte, Chicago, Houston, Jacksonville, Memphis, Nashville, Orlando, Phoenix, South Florida, Tampa, Washington DC/Northern Virginia | | Contact: | Jim Ingram
Executive Vice President and Chief Investment Officer
Parkway Properties, Inc.
One Jackson Place
188 East Capitol Street, Suite 1000
Jackson, Mississippi 39201
(601) 948-4091
(800) 748-1667
E-Mail Jim Ingram |
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