Brandywine Forms JV with DRA, to Own 50% Interest, Will Buy Portfolio in Austin, TX, Sees Proceeds $271.6M

Brandywine Realty Trust

, a real estate investment trust focused on the ownership, management and development of urban, town center and suburban office properties in the mid-Atlantic region and other select markets throughout the United States, announced today that it has formed a joint venture (the "Venture") with DRA Advisors LLC ("DRA").  Brandywine and DRA will each own a 50% interest in the Venture that will acquire Brandywine's wholly-owned office portfolio located in the Southwest submarket in Austin, Texas. Brandywine will continue to provide property management, leasing, and construction management services. Brandywine and DRA intend to jointly pursue additional office opportunities in targeted Austin sub-markets and plan to co-invest additional equity in acquisitions that meet certain investment criteria. The Venture will acquire the properties from Brandywine for $330.0 million or $236 per square foot, representing a capitalization rate of approximately 6.7% cash and 7.0% GAAP based on current net operating income.  The joint venture has secured $230.6 million of non-recourse debt through three separate mortgages that have a weighted-average maturity of 5.0 years and an expected weighted-average interest rate of 3.75%.  The transaction and related financings are expected to close early in the fourth quarter. Properties to be Acquired by the Joint Venture # of Currently Portfolio Square Feet  Buildings Leased             Barton Skyway 4 786,845 94.4%             The Park on Barton Creek 2 205,195 100.0%             7000 West at Lantana 2 136,075 100.0%             Cielo Center 3 270,711 99.6% 11 1,398,826 96.8% Brandywine expects to receive $271.6 million of proceeds, after deducting $5.7 million of transaction and joint venture formation costs.  Brandywine expects to use the net proceeds to further advance our growth and deleveraging strategy.