BRE Properties Provides Disposition Activity Update

BRE Properties, Inc. (NYSE:BRE), a leading owner, operator and developer of high-quality apartment communities in targeted growth markets in California and Seattle, announced today the following disposition activity:
  • In June 2013, the Company completed the sale of Summerwind Townhomes, a 200-home, wholly-owned apartment community in Los Angeles, CA, for total net proceeds of $46.8 million.
  • Also in June, the Company completed the sale of Arcadia Cove, a 432-home apartment community in Phoenix, AZ, in which the Company owned a 15% interest. Total net proceeds to BRE were $6.0 million.

The sale of these communities resulted in a combined net gain of approximately $22 million. Both communities were held on an unencumbered basis.

“These sales further our strategy of disposing of non-core communities and recycling capital into our high-barrier, core in-fill development pipeline,” commented Constance B. Moore, President and Chief Executive Officer. “Including our first quarter dispositions, we have generated approximately $100 million in sales proceeds and are targeting an additional $75 million to $125 million of communities to be marketed for sale in the second half of 2013.“

Additional information regarding the community sales:
                                               
Community        

BREOwnership
        Homes        

YearBuilt
       

May 2013Revenue perOccupiedHome
       

YTD 2013Annualized NOI (1)
       

YTD 2013 vs. 2012Revenue Growth (3)
Summerwind Townhomes         100%         200         1987         $1,889         $2,846,000         0.1%
Arcadia Cove (JV)         15%         432         1996         $825         $2,620,000(2)         4.6%
 

(1) Represents net operating income for the period January 1, 2013 through May 31, 2013, annualized.(2) Represents 100% of community net operating income. BRE maintained a 15% interest in Arcadia Cove.(3) Represents total revenue growth for the community between year-to-date May 2013 and year-to-date May 2012.

The gross sales price on Summerwind Townhomes represents a 5.9% seller’s capitalization rate based on the community’s trailing 3-month net operating income (the implied capitalization rate including the impact of the Proposition 13 step-up in property taxes upon sale is an estimated 5.5%).

Proceeds from the dispositions initially will be used to repay amounts outstanding under the Company’s $750 million unsecured revolving credit facility and subsequently deployed to fund the Company’s development activities over the next several months as well as other working capital needs.

About BRE Properties

BRE Properties, based in San Francisco, California, focuses on the development, acquisition and management of apartment communities located primarily in the major metropolitan markets of Southern and Northern California and Seattle. BRE directly owns 74 multifamily communities (totaling 21,126 homes) and has joint venture interests in one additional apartment community (totaling 252 homes). BRE Properties is a real estate investment trust (REIT) listed in the S&P MidCap 400 Index. For more information on BRE Properties, please visit our website at www.breproperties.com.

Copyright Business Wire 2010

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