Highwoods Properties Inc. (HIW), a real estate investment trust (REIT), has recently renewed its lease agreement with Umicore Group – a global materials technology firm. The company has leased 15,200 square feet of space in its Glenwood Avenue building in Raleigh to the Belgium-based technology group to facilitate its huge expansion program. With the lease, Umicore would relocate its existing employees from the Magnolia Building in the Highwoods office park, also in Raleigh, to the newly-leased property.

Although Umicore was non-committal about the number of new jobs it intended to add, the relocation would enable it to increase its office space by approximately 3,200 square feet, thereby assisting it to further expand its business in the region. The company expects to occupy the newly-leased property by the end of June 2011.

Umicore has been operating its North American business from Raleigh since 1997. In the U.S., the company focuses on several product lines, including chemicals for catalyst engine applications, fuel cells, infrared optics and materials for TV displays.

Based in Raleigh, North Carolina, Highwoods owns and operates its properties through its wholly-owned subsidiary, Highwoods Realty Limited Partnerships. The company has interests in office, industrial, retail and service center properties, including development projects and apartment units. It also provides customer-related and fee-based real estate management services for its properties and third-party clients.

As of December 31, 2010, Highwoods had interests in 330 in-service office, industrial holdings and retail properties, spanning across 32.4 million square feet of gross leasable space. In addition, it also owned 611 acres of developable land.

Currently, Highwoods is in the process of repositioning its portfolio to focus on stronger long-term markets and newer assets. A large part of the company’s portfolio is now concentrated in high-growth Sun Belt markets, such as Atlanta, Nashville and Tampa, which should exhibit above-average job growth due to long-term demographic trends.

We maintain our ‘Neutral’ rating on Highwoods for the long term. The company presently has a Zacks #2 Rank, which translates into a short-term ‘Buy’ recommendation. We also have a Neutral recommendation and a Zacks #3 Rank (short-term ‘Hold’) for Liberty Property Trust (LRY), one of the competitors of Highwoods.

 
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