ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Wednesday, August 21, 1996 TAG: 9608210027
SECTION: BUSINESS PAGE: B-8 EDITION: METRO
DATELINE: RICHMOND
SOURCE: Bloomberg Business News
CHARLES E. SMITH COS. will take over the majority of RF&P from the Virginia Retirement System.
The Virginia Retirement System said Tuesday it has reached an agreement to put 55 percent of the assets of its real estate unit in a new partnership with developer Charles E. Smith Cos., according to a pension fund spokesman.
The agreement is a partial resolution to a more than 1-year-old plan by the pension fund to sell the unit, RF&P, which was once the subject of a criminal investigation.
Under the agreement, reached last week, most of RF&P's commercial real estate holdings, including shopping centers and office buildings in Arlington's vast Crystal City development, will be contributed to the partnership, said the spokesman, Bill Sullivan.
The partnership will then seek to form a private real estate investment trust and sell shares to institutional investors. RF&P will continue to own and manage its remaining assets, but will consider selling the properties, said Sullivan.
Smith is the largest real estate owner in Northern Virginia and has been a partner with RF&P in several real estate developments. The two jointly own about 5 million square feet of office space at Crystal City.
The $22 billion state pension fund has been seeking to sell RF&P for more than a year and hired investment bank Lehman Brothers in September after receiving four unsolicited bids for the Richmond-based company.
Officials of the pension fund were subjects of a three-year investigation by the federal government, which claimed that the fund's takeover of RF&P in 1991 resulted in securities fraud, wire fraud, mail fraud and other criminal acts by former Virginia Retirement System officials.
The government last fall dropped the charges, citing a lack of proof of federal offenses.
LENGTH: Short : 44 linesby CNB