Manulife US REIT (MUST) has secured a 65-month renewal for Kilpatrick Townsend, its largest tenant at its 1100 Peachtree property in Midtown Atlanta. The Atlanta-headquartered international law firm’s current floor plate makes up about a third of the net lettable area (NLA) within the property.
Kilpatrick Townsend, which has been a major tenant in 1100 Peachtree since 1992, is also the REIT’s fourth largest tenant.
Its lease term was due to expire on July 31, 2025. With the renewal, Kilpatrick Townsend’s lease will now expire on Dec 31, 2030.
According to the REIT, the renewal of its fourth-largest tenant validates its commitment to renovate 1100 Peachtree’s ground floor and common spaces. The renovations, which will see a new lobby, elevator cabs, upgraded landscaping and hardscaping of the building exteriors among some of the changes, are expected to be completed in 2025.
This asset enhancement, which was announced in November 2022, is expected to cost around US$18 million ($24.7 million).
“We are delighted that Kilpatrick Townsend has chosen to remain at 1100 Peachtree, and it reaffirms our commitment to fostering long-term relationships with our valued tenants. It also underscores the appeal of this Class A property, its prime location in Midtown Atlanta, and its sustainability credentials, such as its LEED Silver, Fitwel and Energy Star certifications,” says Tripp Gantt, CEO of the manager. “Kilpatrick Townsend’s lease renewal meets our expectations for the market and justifies our investment into the modernisation of the property. This demonstrates our dedication to delivering a premier, contemporary office product, and we are excited to work with tenants like Kilpatrick Townsend to create inspiring and innovative workplaces that will meet their evolving needs.”
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“Meanwhile, in our efforts to address the financial covenant breach in our loan agreements and assemble a sponsor package that ensures the REIT's viability through the coming years, we continue to have discussions with the lenders alongside our sponsor. As the negotiations continue, we seek unitholders’ understanding and patience while we finalise a solution to set MUST on a path forward,” he adds.
Units in MUST closed at 4.9 US cents on Oct 19.
