SunTrust Plans Sale-Leaseback of 48 Office Buildings, 425 Bank Branches

CNN Money/Commercial Property News - July 3, 2007

As SunTrust pursues its goal of saving $530 million by 2009, the bank said today it will sell and then lease back 473 facilities--48 office buildings and 425 retail branches--in the Southeast and Mid-Atlantic regions.
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William Reed Jr., SunTrust vice chairman in charge of its geographic banking organization, said the office buildings would be marketed separately but the sale/leaseback of the retail branches would be offered in one portfolio. No branch closures are planned as part of the sale/leaseback initiative, he said in a release. The total square footage of the office buildings was not disclosed.

A SunTrust spokesman told CPN today that of the bank's 1,691 branches, the company owns 720. "We are selling about 58 percent of the branches of the 720 owned and 25 percent overall," he said. The spokesman declined to say whether SunTrust expected to put the remaining branches it owns up for a similar sale/leaseback initiative in the future. "This is the extent of what we've announced," he said, adding that the company expected these transactions to be completed by the end of the year.

The sale/leaseback plan of SunTrust's corporate real estate is part of an overall restructuring program to boost efficiency and raise shareholder value.

"All the transactions are either net sale/leasebacks or sale partial leasebacks," the spokesman said, adding that the company would consider selling the office buildings in groups rather than individually.

He said SunTrust was the sole tenant in most of the buildings. The spokesman reiterated that SunTrust was going to keep a significant presence in the office buildings for an extended period of time even though the company is looking to shed about 300 positions in its geographic banking organization. Sphere: Related Content