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Colonial Properties Trust Signs Agreement for Option To Sell Certain Multifamily Assets

^{Published on 2011-07-26 11:46:01 - Market Wire}
 

BIRMINGHAM, Ala.--([ BUSINESS WIRE ])--Colonial Properties Trust (NYSE: CLP) announces that it has entered into an agreement providing for an option to sell certain multifamily assets.

The agreement provides for the potential sale of up to 5,659 apartment homes for an aggregate purchase price of approximately $338million. The portfolio of properties includes 18 apartment communities located in Georgia, North Carolina, Texas and Virginia and has an average age of 25 years, and would represent a sales cap rate of approximately 6.0%. The companya™s 90/10 multifamily/commercial portfolio mix target remains unchanged. Our on-going strategy is to recycle older multifamily assets to improve the multifamily portfolioa™s average age, margin and capital expenditure requirements. Under the terms of the agreement, the transaction will only be completed if the company is able to identify reinvestment opportunities for the sales proceeds. In addition, the agreement provides the company with the option to cancel the contract at any point in time upon a termination payment of $250,000 to reimburse the buyer for due diligence costs. The sale of units is also subject to satisfaction of customary closing conditions. No assurance can be given that the company will complete the sale of any units under this agreement.

Colonial Properties Trust is a real estate investment trust (REIT) that creates value for its shareholders through a multifamily focused portfolio and the management and development of select commercial assets in the Sunbelt region of the United States. As of March 31, 2011, the company owned or managed 35,188 apartment units and 14.6 million square feet of commercial space. Headquartered in Birmingham, Alabama, Colonial Properties is listed on the New York Stock Exchange under the symbol CLP and is included in the S&P SmallCap 600 Index. For more information, please visit the company's website at [ www.colonialprop.com ].

Safe Harbor Statement

aSafe Harbora Statement under the Private Securities Litigation Reform Act of 1995: Estimates of future earnings are, by definition, and certain other statements in this press release, including statements regarding the likelihood of completion of the sale of units under the above-referenced purchase agreement, may constitute aforward-looking statementsa within the meaning of the Private Securities Litigation Reform Act of 1995 and involve known and unknown risks, uncertainties and other factors that may cause the companya™s actual results, performance, achievements or transactions to be materially different from the results, performance, achievements or transactions expressed or implied by the forward looking statements. Factors that impact such forward looking statements include, among others, changes in national, regional and local economic conditions, which may be negatively impacted by concerns about inflation, deflation, government deficits, high unemployment rates, decreased consumer confidence and liquidity concerns, particularly in markets in which we have a high concentration of properties; exposure, as a multifamily focused REIT, to risks inherent in investments in a single industry; ability to obtain financing on favorable rates, if at all; performance of affiliates or companies in which we have made investments; changes in operating costs; higher than expected construction costs; uncertainties associated with the timing and amount of real estate disposition and the resulting gains/losses associated with such dispositions; legislative or regulatory decisions; the companya™s ability to continue to maintain our status as a REIT for federal income tax purposes; price volatility, dislocations and liquidity disruptions in the financial markets and the resulting impact on availability of financing; the effect of any rating agency action on the cost and availability of new debt financings; level and volatility of interest rates or capital market conditions; effect of any terrorist activity or other heightened geopolitical crisis; or other factors affecting the real estate industry generally.

Except as otherwise required by the federal securities laws, the company assumes no responsibility to update the information in this press release.

The company refers you to the documents filed by the company from time to time with the Securities and Exchange Commission, specifically the section titled aRisk Factorsa in the companya™s Annual Report on Form 10-K for the year ended December31, 2010, as may be updated or supplemented in the companya™s Form 10-Q filings, which discuss these and other factors that could adversely affect the companya™s results.