Columbia Property Trust Braces for NYC, DC Vacancies After Strong Q4 Leasing
Amazon Web Services set to leave REIT’s East Palo Alto, Calif., property by July 1
By Andrew Coen February 19, 2021 9:00 am
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Columbia Property Trust (CXP) finished the fourth quarter of 2020 with a 95.6 percent occupancy rate, but is poised to lose some key anchor tenants to expiring leases in 2021, according to the company’s fourth-quarter earnings report released late Thursday.
Manhattan-based Columbia reported fourth-quarter net income of $101.7 million, compared with a $21.9 million loss in the final three months of 2019. The earnings reflected a one-time $8.1 million charge against lease revenues, with $7.2 million of this amount stemming from moving nine tenants to a “cash accounting basis” following delinquencies, Columbia CEO Nelson Mills said on an investors call.
Another big tenant loss for Columbia as of July 1 will be law firm Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, which is vacating 54,000 square feet in 701 Pennsylvania Avenue NW in Washington, D.C., for office space in the Thurman Arnold Building. The Pennsylvania Avenue property has an additional 120,000 square feet of current vacancies and a capital improvement plan is underway to attract new tenants, according to Gronning.
Gronning said 799 Broadway, a new office building in Midtown Manhattan slated to open in July, has attracted lease proposals ranging from 10,000 square feet to 40,000 square feet. Mills noted that the company has hosted multiple tours in the past week with prospective tenants that include a technology company not currently located in New York City. The identity of said tenant could not be identified by press time.
Columbia is also positioning 149 Madison Avenue for lease-up after coworking giant WeWork exited the 122,000-square-foot Midtown property last summer. Gronning said he hopes to have the newly renovated property ready for occupancy in late 2021.
The real estate investment trust reported total 2020 revenue of $300.6 million, compared with $288.8 million in 2019. Its 2020 lease revenue was down slightly, to $262.1 million, versus $276.1 million a year earlier.
