Catellus Sells Residential Development for $42 Million Gain
24 December 2003 - 8:38AM
PR Newswire (US)
Catellus Sells Residential Development for $42 Million Gain SAN
FRANCISCO, Dec. 23 /PRNewswire-FirstCall/ -- Catellus Development
Corporation announced today that a wholly owned subsidiary
completed the redemption of its 30 percent interest in Talega, a
residential-community development project located in San Clemente,
California, by its joint venture partners for $47.4 million,
resulting in a pre-tax gain of approximately $42 million. The
redemption price consists of $11.8 million cash and a $35.6 million
one-year note. Catellus and its partners acquired and entitled the
land for a total of 4,000 home sites in 1997, and since that time
have sold to third party home developers 3,108 lots. Since 1997,
Catellus has invested a total of $15.2 million into the Talega
partnership and realized $83.6 million in pre-tax gain, which
includes the $42 million realized from the redemption transaction.
"With this sale, we are taking advantage of the continued strength
in the housing market and accelerating our efforts to monetize our
non-core businesses," commented Nelson C. Rising, chairman and CEO
of Catellus. "By structuring a portion of the redemption price in
the form of a one-year note, we have provided additional time to
reinvest this sizable gain back into our core industrial business."
On January 1, 2004, Catellus will officially convert from operating
as a C corporation to operating as a publicly traded real estate
investment trust, or REIT, focused predominantly on developing and
owning industrial property, a transition that was initially
announced on March 3, 2003. Catellus Development Corporation is a
publicly traded real estate development company that owns and
operates approximately 38.2 million square feet of predominantly
industrial property in many of the country's major distribution
centers and transportation corridors. The company's principal
objective is sustainable, long-term growth in earnings, which it
seeks to achieve by applying its strategic resources: a
lower-risk/higher-return rental portfolio, a focus on expanding
that portfolio through development, and the deployment of its
proven land development skills to select opportunities where it can
generate profits to recycle back into its business. More
information on the company is available at
http://www.catellus.com/. Except for historical matters, the
matters discussed in this release are forward-looking statements
that involve risks and uncertainties. Forward- looking statements
include, but are not limited to, statements about plans,
opportunities, and development. We caution you not to place undue
reliance on these forward-looking statements, which reflect our
current beliefs and are based on information currently available to
us. We do not undertake any obligation to publicly revise these
forward-looking statements to reflect future events or changes in
circumstances, except as may be required by law. These
forward-looking statements are subject to risks and uncertainties
that could cause our actual results, performance, or achievements
to differ materially from those expressed in or implied by these
statements. In particular, among the factors that could cause
actual results to differ materially are: ability to obtain the
consents and satisfy the various other requirements for
consummating the conversion of our business to a real estate
investment trust (REIT) and the timing of the REIT conversion;
changes in the real estate market or in general economic
conditions, including a worsening economic slowdown or recession;
product and geographical concentration; industry competition;
availability of financing and changes in interest rates and capital
markets; changes in insurance markets; discretionary government
decisions affecting the use of land, and delays resulting
therefrom; changes in the management team; weather conditions and
other natural occurrences that may affect construction or cause
damage to assets; changes in income taxes or tax laws; liability
for environmental remediation and changes in environmental laws and
regulations; failure or inability of third parties to fulfill their
commitments or to perform their obligations under agreements;
failure of parties to reach agreement or definitive terms or to
close transactions; increases in the cost of land and construction
materials and availability of properties for future development;
limitations on, or challenges to, title to our properties; risks
related to the financial strength of joint venture projects and
co-owners; changes in policies and practices of organized labor
groups; shortages or increased costs of electrical power; other
risks inherent in the real estate business; and acts of war, other
geopolitical events and terrorists activities that could adversely
affect any of the above factors. For further information, including
more detailed risk factors, you should refer to Catellus
Development Corporation's annual report on Form 10-K/A for the
fiscal year ended December 31, 2002, and its reports on Form 10-Q
for the quarters ended March 31, 2003, June 30, 2003, and September
30, 2003, filed with the Securities and Exchange Commission
("SEC"), as well as the proxy statement/prospectus filed with the
SEC on August 15, 2003. Information contained in this press release
is not a substitute for the proxy statement/prospectus.
STOCKHOLDERS AND INVESTORS ARE URGED TO READ THE PROXY
STATEMENT/PROSPECTUS, BECAUSE OF ITS IMPORTANT INFORMATION,
INCLUDING DETAILED RISK FACTORS, ABOUT CATELLUS DEVELOPMENT
CORPORATION AND THE PROPOSED REIT CONVERSION. The proxy
statement/prospectus is available free of charge at the SEC's
website ( http://www.sec.gov/ ), or at the company's website (
http://www.catellus.com/ ), or by directing a request for such a
filing to Catellus Development Corporation at 201 Mission Street,
Second Floor, San Francisco, California, 94105, Attn.: Director of
Investor Relations, or by telephone at 415-974-4649, or by email to
. Contacts: Margan Mitchell Minnie Wright Corporate Communications
Investor Relations 415-974-4616 415- 974-4649 DATASOURCE: Catellus
Development Corporation CONTACT: Margan Mitchell, Corporate
Communications, +1-415-974-4616, or Minnie Wright, Investor
Relations, +1-415-974-4649, both of Catellus Development
Corporation Web site: http://www.catellus.com/
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