USAA Weighing Sale Leaseback of Four Regional Offices

The Virginian-Pilot, Norfolk, Va. - December 22, 2003

USAA, the diversified provider of insurance, investment and banking services, said it is weighing the possible sale of its four regional offices, including one in Norfolk, as a way to enhance its financial condition. The San Antonio-based company said the proposal to sell the buildings and lease them back from a buyer would free up assets that USAA could put into revenue-generating investments. If it acts on this plan, a transaction would likely occur this summer, USAA said in a statement.

The proposed sale and leasing arrangement, it said, are contingent on receiving an attractive offer. USAA said it would maintain control over operations at the four buildings and lease them back through long-term, renewable contracts. The other three offices are in Tampa, Fla., Colorado Springs and Sacramento, Calif.

USAA opened a temporary mid-Atlantic regional office in Norfolk in 1989. Three years later, the office was moved to a complex that USAA built on Northampton Boulevard near Military Highway. The main building, with 340,666 square feet of space, a parking garage and a child-care center, are surrounded by a 33-acre campus. The property's assessed value is $25.3 million, said Karen Gulbranson, a USAA spokeswoman in Norfolk.

Instead of broadening its network of regional offices as it once planned to do, USAA has been realigning its regional structure and building a large operations facility in Phoenix. That facility and USAA's headquarters and operations center in San Antonio are not part of the proposed sale-leaseback transaction.

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