Shares of MPG Office Trust Inc. jumped more than 12 percent Thursday after the office landlord turned over a five-story building in Irvine to its lender in an effort to reduce debt.
The Los Angeles real estate investment trust, formerly known as Maguire Properties, said relinquishing the 150,000-square-foot building at 17885 Von Karman relieved it of a $26.4 million construction loan obligation and a $6.7 million repayment guaranty. The company also paid the lender $2 million to further reduce the loan.
“Our efforts that started two years ago to reduce debt, eliminate repayment and debt service guarantees and extend debt maturities continue to produce positive results,” said Chief Executive Nelson Rising in a statement late Wednesday.
MPG in the past several months has been divesting buildings to help pay off debt it incurred prior to the commercial real estate downturn. In 2007 it bought 24 office properties and 11 development sites for $2.88 billion from Blackstone Group LP.
MPG changed its name from Maguire Properties earlier this month in an effort to distance itself from founder, Robert F. Maguire III, who resigned as CEO two years ago but continues to be a major shareholder.
Shares closed up 34 cents, or 12.6 percent, to $3.04 on the New York Stock Exchange.