Armada Hoffler Properties Inc. revised its full-year guidance for normalized funds from operations to $1.00 to $1.03 per share, compared to its previously projected range of $1.05 to $1.08.
The Virginia Beach, Va.-based real estate investment trust updated its forecast after agreeing to sell its at-cost purchase option to the developer of The Residences at Annapolis Junction in Annapolis Junction, Md., for $5.0 million, according to a release.
In April 2016, Armada agreed to a $68 million guaranteed maximum price construction contract as general contractor to build the apartment property, as well as a purchase option to acquire an 88% stake in the project, at the developer's cost basis, upon completion of construction.
The deal to sell the option was, as of the end of July, expected to generate total proceeds of over $50 million, accounting for the repayment of a related mezzanine loan in the third quarter.
Under the new agreement, the developer may refinance the project, which is almost 65% leased, and extend the maturity of the related mezzanine loan.
The transactions are slated for completion in the fourth quarter, at which time the developer is expected to pay down the mezzanine loan balance by over $10.0 million.