UPDATE: Stifel Nicolaus Upgrades MPG Office Trust to Buy

Stifel Nicolaus raises its rating on MPG Office Trust (NYSE: MPG) to Buy from Hold, and establishes a $3 price target, as outlook turns positive for the company. Stifel Nicolaus says, "We are upgrading MPG to Buy from Hold as 1) we think investors will now pay $350-400/SF for Gas Company Tower, KPMG Tower, Wells Fargo Tower or 777 Tower (but not US Bank Tower), 2) an abundance of capital is looking for opportunistic investments, 3) 400 South Hope, an excellent 80% occupied asset, is a notch below the premium MPG Downtown Los Angeles (DTLA) assets, yet may sell for $350/SF, 4) each $10/SF increase in value of the four DTLA assets, which total 6.0mm SF, equates to just over $1.00/sh increased value, 5) we expect a $50-100mm pay down requirement on the KPMG loan, paid either with cash on hand or JV equity." MPG closed at $2.34 a share on Wednesday.