Catellus to Reorganize as REIT

Catellus Development Corp., San Francisco, is going to reorganize its operations to qualify as a real estate investment trust effective Jan. 1, 2004, the company has reported.The real estate development company's main area of operation is in the industrial sector. The REIT conversion has been approved by the company's board of directors and is still subject to shareholder approval, Catellus said. The conversion, which Catellus sees as "the logical next step" for the company, is intended to provide investors with a stable cash return, while "continuing to offer growth opportunities" for the company. Catellus expects to provide a one-time distribution of pre-REIT earnings and profits to shareholders, currently projected to be approximately $100 million in cash and $200 million in common stock. Following the conversion, Catellus expects to operate as an umbrella partnership real estate investment trust with taxable REIT subsidiaries that are expected to hold the assets that have been identified as "development for sale."