Insurance company selling, leasing back commercial property

Dallas will be a major hub for State Farm Insurance.

One of the nation's top insurance firms is looking to sell nearly two dozen offices and commercial facilities, according to The Dallas Morning News.

State Farm Insurance, which is based out of Illinois, is building a 1.5 million-square-foot office campus in Richardson, Texas, after expanding into the Dallas area last year. The plan is to move thousands of employees to the Dallas region as part of a consolidation plan.

The insurance company's Richardson complex will be completed sometime in 2015. The complex can accommodate 6,500 employees. KDC, the developer, will take ownership of the complex.

"These are being marketed as a single package to potential buyers," State Farm's Patti Kelly said. "None of the facilities in Dallas are included in this offering. We are currently exploring options for the Dallas operations center as we move more employees to the hub."

The sales plan for the commercial property is a "flexible real estate strategy to allow us to meet changing customer needs and expectations," according to Kelly.

"Our operations in each of these locations will continue as they are today, as we are leasing back the facility once it is sold," Kelly added. "The sale of these buildings does not indicate a change in our workforce in any of the locations."

Selling the buildings and then leasing them back allows the company to deploy capital it invested in the real estate while still being able to utilize the buildings.

State Farm did just that in May, finishing a $73 million sale/lease-back transaction with its seven operations centers in Tempe, Ariz.

State Farm to sell and lease back property in Nebraska
The change in facilities doesn't end in Texas for the insurance giant. One of the locations State Farm plans to sell and lease back is in Lincoln, Neb., where a 220,000-square-foot building and 129,000-square-foot south building reside.

"We carefully evaluated the type of work done in our Lincoln facility and it was determined some job functions could be effectively consolidated with similar work at other company locations," the company said. "Those eligible employees, who choose to remain with the company, may qualify to receive benefits. This may include a relocation allowance to move to another community to work for State Farm."

Other reported cities where State Farm plans to sell and lease back property include: Atlanta; Bakersfield, Calif.; Birmingham, Ala.; DuPont, Wash.; Greeley, Colo.; and Malta, N.Y.

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