Cousins Properties, Inc. – a bellwether Atlanta-based REIT – has closed its previously announced purchases of two office projects in Texas for a total cash price of $1.1 billion.
The two purchases increase Cousins presence in one of the fastest growing regions of the country, according to urban demographer Joel Kotkin, who’s been including the Third Coast since at least 2011 in his list of the nation’s growth corridors.
The Cousins deal includes a 10-building office project in Houston, which Kotkin names as “the clear center” of a mega region that stretches along the Gulf of Mexico from Texas to Florida. Houston was the destination of this year’s LINK delegation, which was covered extensively by Maria Saporta.
To put the acquisitions in context, Cousins was valued at about $1.9 billion by nasdaq.com on Wednesday morning.
Cousins stock was downgraded last week from buy to hold by TheStreet Ratings.
The report noted positive signs including, “revenue growth, reasonable valuation levels and solid stock price performance.” The weaknesses cited in the report included, “unimpressive growth in net income, poor profit margins and weak operating cash flow.”
Cousins sold a retail center in August in a move intended to raise cash for the Texas transaction, according to zacks.com. Cousins sold one of its Avenue retail centers, a 752,000-square-foot center outside Nashville, in Murphreesboro.
Cousins’ latest purchases include:
The Houston purchase is Cousins’ second in the city this year. Post Oak Central was purchased for $232.6 million, or $182 a square foot, and was 92 percent leased, according to SEC filings earlier this year.
The Texas acquisitions are line with the company’s ongoing efforts to refocus its portfolio on growth markets, which includes a reduction of its footprint in Atlanta. To put the purchase in context, Cousins was valued Wednesday by nasdaq.com at about $1.9 billion.
Cousins reported in its 2012 annual report that it intended to broaden its holdings outside Atlanta. The company reported that 56 percent of its income came from four properties in Atlanta: Terminus 100, 191 Peachtree Tower, the American Cancer Society Center and Prominade. The report stated: