American Financial Inks Three Big Leases; Drops a Property

JENKINTOWN, PA-Four separate transactions tightened the balance sheet for locally based American Financial Realty Trust. It disposed of a non-core, 26,000-sf office property in Key Biscayne, FL for approximately $3.4 million and inks three large lease transactions at diverse locations.

Shurgard Storage Centers signs a 20-year lease agreement for approximately 48,000 sf in the 172,000-sf Jenkins Court building here. The rent begins in July 2004. The annual rent under the triple net lease begins at $120,000 with periodic increases throughout the term. The agreement “increases the percentage of income derived from credit tenants in this facility and stabilizes the occupancy and income in the complex for many years to come,” says Glenn Blumenthal, American Financial’s COO.

South Trust Bank inks a 10-year lease for 5,000 sf in a former Wachovia branch in Richmond, VA. Its lease begins in February 2004. Annual rent begins at $70,000 with annual increases throughout the term. This is a first American Financial lease for South Trust Bank, and Nicholas Schorsch, the financial REIT’s president and CEO, says he hopes “it is the first of many mutually beneficial transactions between our organizations.”

RBC Centura Bank completes six new leases, making it among American Financial’s top 10 tenants. Its total branch area leases are now approximately 34,000 sf, and its annual contractual rent is approximately $1.3 million. Schorsch says adding RBC to its top 10 roster “demonstrates our ability to attract strong credit tenants into our branch portfolio while diversifying our tenant mix.”

The sale of the Key Biscayne building reduces American Financial’s vacant square footage by 17,000 sf and its operating expenses by more than $115,000 a year, according to Blumenthal.