03/14/2013 | By Carisa Chappell
Highwoods was founded in 1978 and is headquartered in Raleigh, N.C. Highwoods owns or has an interest in 333 in-service office, industrial and retail properties encompassing approximately 34.6 million square feet. The company also owns 649 acres of development land. Highwoods’ properties and development land are located in Florida, Georgia, Mississippi, Missouri, North Carolina, Pennsylvania, South Carolina, Tennessee and Virginia.
Fritsch discussed his company’s efforts to reposition its office portfolio.
“We’ve been at this endeavor for some time. In 2005 we rolled out a strategic plan to dramatically change the portfolio. So, in the eight or so years since then, we are about two-thirds different in our assets today versus when we started,” he said.
In addition to his company’s office assets, Fritsch covered the performance of Highwoods’ industrial and retail properties, which make up 11 percent of the company’s portfolio. Fritsch said fundamentals are strong in those sectors, given the state of the economy.
“In retail we ended the year at 96.8 percent occupied and our sales were up 11 percent year over year,” he said. “It’s also significantly integrated with office, so it’s a true mixed-use development.”
Fritsch also offered some insight into the geographical diversity of Highwoods’ portfolio. He noted that the company has “dramatically” downsized its presence in Kansas City, Mo., since entering the locale in the 1990s. Highwoods now owns approximately 1.5 million square feet of integrated retail and office properties in the city’s Country Club Plaza area.
“It has really done well for us and our shareholders,” he said.
Highwoods’ Pittsburgh assets are performing well, too, according to Fritsch.
“We found it’s not the Pittsburgh that you remember it to be. It’s a very diverse and energetic economy. We snuck in there and bought some assets that have performed magnificently well in the year-and-a-half that we owned them, so we are very excited about being in that marketplace today,” he said.