Wells REIT Ready to Expand Holdings in Southern California

Atlanta-based Wells Real Estate Investment Trust Inc. has allocated $500 million to buy office and industrial properties in Southern California during the next six months.

Privately held Wells bought the Glendale headquarters building of Nestle USA Inc. for $157 million in December and wants to expand its holdings in Los Angeles, Orange and San Diego counties, said David Steinwedell, Wells’ chief investment officer.

“We’d love to buy other properties of that quality,” he said of the Nestle building, “but we’re also looking for property a little more modest -- in the $30-million-to-$40-million range.”

Although rents in the Los Angeles County office market are generally flat, the region is attractive in the long term, he said.

“Los Angeles and Southern California will be major economic engines going forward,” he said. “We want to invest where things will be good seven, 10 or 12 years from now.”

The Wells REIT has purchased more than $1 billion worth of properties this year, with a goal to acquire $2.5 billion by the end of 2003. Most of its holdings are in Midwestern and Southern cities such as Minneapolis, Dallas and Houston.