Telecom Giant’s Longterm Lease, BBB+ S&P Credit Rating Could Help Draw International Investor Interest
AT&T could quickly have a new landlord at the company’s global headquarters tower in downtown Dallas, with CBRE brokers expected to put the telecom giant’s 37-story, 965,800-square-foot tower– and, more importantly, a long-lasting lease by an extremely rated credit renter– on the marketplace in the future.
AT&T’s lease, which runs through August 2030, was structured as a sale-leaseback handle an affiliate of New York-based Icahn Enterprises LP, led by Wall Street investor and billionaire Carl Icahn.
IEP Dallas Inc., the affiliated ownership entity, has hired a team of CBRE brokers to start marketing the workplace tower, called One AT&T Plaza, at 208 S. Akard St., and the long-term lease with AT&T. Although the office tower, likewise called Whitacre Tower, last cost $60.1 million in 2008, regional realty brokers state the long-lasting lease is the most valuable part of this deal, worth approximately $278 million.
North Texas has actually seen several big sale-leaseback handle current years, including State Farm Insurance’s $825 million sale-leaseback of its local hub in Richardson, and the $344 million sale of Verizon’s school in Irving to Chicago-based Mesirow Financial.
J.C. Penney Company Inc. also seized the day to substantially diminish its business footprint in a sale-leaseback offer to Dallas designer Sam Ware, who has actually been redeveloping the home into a multi-tenant campus.
Property sources state this offer would likely be comparable with the creditworthiness of AT&T bring in worldwide and domestic financier interest from institutional financiers and high net worth individuals. According to S&P Global Ratings, the telecom giant was given a grade of BBB+. Fitch Rankings has AT&T clocking a credit score of A-.
The 35-year-old office tower, initially developed for Southwestern Bell, works as a crucial part of AT&T’s downtown Dallas school, and is currently undergoing a $100 million redevelopment to produce an “urban-tech” school designed to attract young specialists and customers alike. As part of the project, the two million-square-foot, multi-building school is likewise being relabelled Discovery District.
Upon completion, Discovery District will have room to house approximately 7,000 staff members, using outside areas for event and Wi-Fi gain access to throughout the campus. The current construction timeline of the job was not right away readily available Thursday.
AT&T’s long-term lease has contractual escalations of 2 percent yearly. As of October 2018, the lease, which was just recently renewed, has estimated profits of $278 million remaining over the regard to the offer.
AT&T and CBRE were not immediately offered to comment Thursday.