Bank of America Looking to Sell 3 Buildings; 2 in Charlotte
CHARLOTTE, N.C. - Up for sale are Bank of America's Hearst Tower and the Fifth Third Center in Uptown Charlotte, as well as a building on Broadway in New York City. A spokesperson says, "After the sale, we will continue to lease space in these properties and there will be no impact to employees."
"I think this is clearly Bank of America managing its balance sheet," says Center City Partners President Michael Smith. He says these types of moves by large, publicly traded companies that own large portfolios of real estate are common. He says, "I think it would be a mistake to interpret is as more than that."
Bank of America says real estate is not a core business for the corporation and the bank "Has a long history in both Charlotte and New York City and we expect to maintain a significant presence for years to come."
The buildings are considered Class A, which means high quality with strong tenants. Despite a weak residential market, the market for Class A commercial is strong, says Matt Shait with The Nichols Company.
"You still have large life insurance companies, large pension funds that are always looking to invest," Shait says. He doesn't think finding a buyer, if the bank doesn't have one already, will take long. Shait anticipates the sales will close in the third quarter.
As for a price? The Hearst Tower has 970,000 square feet, the Fifth Third Center has more than 666,000. "They could go from anywhere from three to four hundred (dollars) a square foot," he says.
Smith says the key here is that Bank of America will continue to lease space in the buildings. "It's when major corporations begin taking less space that their can be some signals going on with long term leases, but that is not the case here," says Smith.
The moves are part of the bank's plan to streamline. CEO Brian Moynihan wants to cut $8 billion in expenses. That includes 30,000 job cuts across the country.