FOR MORE INFORMATION, CONTACT:
David H. Hoster II, President and Chief Executive Officer
N. Keith McKey, Chief Financial Officer
(601) 354-3555
JACKSON, MISSISSIPPI, December 13, 2005 -- EastGroup Properties (NYSE-EGP) today announced the acquisition of a 112,000 square foot business distribution property in Tampa, Florida for a purchase price of $7,350,000. Constructed in 2001, the building (renamed Oak Creek IV) is 100% leased to a single customer, and the purchase includes land to accommodate a 46,000 square foot expansion to the building. Oak Creek IV is projected to generate an unleveraged cash yield of 8.4% at 100% occupancy.
As part of the acquisition price, EastGroup assumed the outstanding first mortgage balance of $4.1 million. This nonrecourse mortgage has a fixed interest rate of 7.26% and matures in 2012.
David H. Hoster II, President and CEO stated, “The acquisition of Oak Creek IV complements our growing presence in the Oak Creek Commerce Park located in the East Tampa/I-75 corridor submarket. It increases our ownership to three buildings with a total of 461,000 square feet, in addition to a 61,000 square foot building under construction (Oak Creek III) and 61 acres of land for future development. We now own 1.2 million square feet in the East Tampa submarket and a total of 2.3 million square feet in the Tampa metro area.”
EastGroup Properties, Inc. is a self-administered equity real estate investment trust focused on the development, acquisition, and operation of industrial properties in major Sunbelt markets throughout the United States with a special emphasis in the states of Florida, Texas, California and Arizona. Its strategy for growth is based on its property portfolio orientation toward premier business distribution facilities clustered near major transportation features. EastGroup’s portfolio currently includes 21.7 million square feet with an additional 939,000 square feet of properties under development.
Certain statements in this release are forward-looking and as such are based upon the Company's current belief as to the outcome and timing of future events. There can be no assurance that future developments affecting the Company will be those anticipated by the Company. These forward-looking statements involve risks and uncertainties (some of which are beyond the control of the Company) and are subject to change based upon various factors, including but not limited to the following risks and uncertainties: changes in the real estate industry and in performance of the financial markets; the demand for and market acceptance of the Company's properties for rental purposes; the amount and growth of the Company's expenses; tenant financial difficulties; and general economic conditions, including interest rates, as well as economic conditions in those areas where the Company owns properties, the risks associated with the development of real property, and other risks and uncertainties detailed from time to time in the Company's SEC filings. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, the Company's results could differ materially from those expressed in the forward-looking statements.
P.O. Box 22728, Jackson, MS 39225-2728
Telephone: 601/354-3555 Fax: 601/352-1441