Alexander & Baldwin Inc. is buying a downtown office building from another local commercial real estate investment firm, which has been liquidating assets to relieve pressure on its finances.
A&B is buying the 10-story Clifford Center on Richards Street from Pacific Office Properties Trust Inc. for $11.2 million, according to a Pacific Office filing with the Securities and Exchange Commission.
The sale is expected to be completed April 17.
The deal will generate needed capital for Pacific Office and help satisfy an A&B goal to acquire more commercial property in Hawaii while selling similar assets on the mainland.
A&B adopted the strategy after spinning off its ocean transportation subsidiary, Matson Navigation Co., to a separate company last year.
In line with that strategy, A&B bought Waianae Mall in January for $30 million.
Meanwhile, Pacific Office has been fighting to survive after the economic downturn hurt the performance of its portfolio of office buildings here and on the mainland.
Pacific Office was established in 2008 by local commercial real estate investor Jay Shidler as a public company with greater access to capital that could be used to expand a portfolio of office buildings Shidler contributed to the firm.
At one time the company owned 24 office properties, including five wholly owned buildings in Honolulu and others in California and Arizona mostly owned with joint-venture partners.
But in the last two years, Pacific Office has sold whole or partial stakes in several buildings, including three in the state.
The first sale involved a 95 percent stake in a Waikiki building at the corner of Kalakaua Avenue and Ala Wai Boulevard in 2011 for an undisclosed price.
Last year, Pacific Office sold First Insurance Center on Ward Avenue for $70.5 million that included $52 million of debt assumed by the buyer.
And last month, Pacific Office sold its 17.5 percent interest in Bank of Hawaii Waikiki Center at 2155 Kalakaua Ave. for an undisclosed price.
Clifford Center has 77,665 square feet of rentable space and is named for architecture and engineering tenant Clifford Projects Inc. Pacific Office paid $6.5 million in 2011 to buy the land under the building, which was 76 percent leased and generated about $1.8 million in rent revenue that year.
The building is the smallest of four Honolulu buildings wholly owned by Pacific Office.
The company’s other Honolulu buildings are Waterfront Plaza with 555,000 square feet, Davies Pacific Center with 375,000 square feet and the Pan Am Building with about 225,000 square feet.
Building sales helped reduce Pacific Office net losses that rose from about $23 million in 2009 to $78 million in 2010 before falling to $22 million in 2011.
For the first nine months of last year, Pacific Office reported a net loss of $3.7 million. The full-year financial report has yet to be published.
Despite the company’s movement toward hoped-for profit, investors remain down on Pacific Office stock, which initially traded at around $7 in 2008 but plummeted to a low of 7.5 cents at the end of last year. On Monday, Pacific Office shares closed at 13 cents.
