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Persis to sell
mainland holdings
for $150 million

Ex-Honolulu Advertiser owner
Thurston Twigg-Smith says the
proceeds will be used to
buy other property

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By Rick Daysog
Star-Bulletin

The former owner of the Honolulu Advertiser is selling more than a dozen of its mainland commercial properties for $150 million as part of a plan to refocus its real estate portfolio.

Honolulu-based Persis Corp. has agreed to sell eight buildings in the Seattle and Portland areas to an undisclosed buyer for about $100 million.

The company is selling five additional mainland properties to several investor groups for about $50 million, according to Thurston Twigg-Smith, chairman and chief executive officer of Persis.

The deals are expected to close by the end of the year.

Twigg-Smith said the company will use the proceeds to acquire new commercial properties on the mainland. The series of transactions, known as a 1031 exchange, will allow Persis to defer capital gains taxes since it will be reinvesting in similar properties. According to Twigg-Smith, the company hopes to acquire properties that will require less hands-on management.

Persis' mainland real estate holdings include low-rise office, retail and light-industrial buildings and house multiple tenants.

The company hopes to exchange those holdings for single-tenant buildings, which would require less supervision. The deals also allow Persis to realize the recent gains in the mainland real estate market. Persis acquired several commercial properties after 1993 when it sold the Honolulu Advertiser to Gannett Co. for $250 million. Since then, real estate values and office vacancies throughout the Pacific Northwest have surged due to the high-tech boom.

None of Persis' Hawaii assets are included in the transactions. Persis owns its Makiki headquarters and has a stake in Big Island Radio, which operates eight radio stations on the island of Hawaii.

The deals also will not affect the company's mainland resort business. Persis owns the Twin Farms, an exclusive 14-room resort in Vermont, and the company is building a $25 million, 20-room resort in Sonoma County in Northern California known as Timber Hill.