Is It Apt To Hold Liberty Property In Your Portfolio Now?
Zacks Investment Research | Jul 10, 2019 09:03PM ET
Liberty Property Trust (NYSE:LPT) has been aiming to divest its non-core properties and using the dry powder for gaining preferred properties across the United States. While such efforts are a strategic fit for long-term growth, the near-term dilution impact of such moves on earnings is unavoidable.
Liberty Property recently announced the sale of a medical-office building — 800 Walnut Street — in Philadelphia, for $99.25 million, the sale price of which is remarkably more than double the building’s development cost. Part of the sale proceeds was used to repay $35.9 million of mortgage debt that encumbered the property. Consequently, the company will record a loss of $7.6 million, or five cents per diluted share, for early extinguishment of debt, in second-quarter 2019.
These efforts to grow the company’s national pure-play industrial platform in top-tier markets and financing that through the disposition of office assets are likely to help the company achieve a favorable portfolio mix.
Further, given its premium-quality industrial portfolio located in upscale locations, pro-business environment and continued e-commerce demand, Liberty Property is well poised to continue on the growth trajectory. This favorable environment is also benefiting a number of other industrial real estate investment trusts (REIT), including Terreno Realty (NYSE:TRNO) , Duke Realty (NYSE:DRE) and Prologis Inc. (NYSE:PLD) .
In fact, the company, which is witnessing decent demand for its properties, announced the addition of two new leases and renewal of a third one in Atlanta.
Encouragingly, over the past year, shares of this Zacks Rank #3 (Hold) company have outperformed the Zacks Investment Research
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