Brookfield Asset Managment Buys Suburban Dallas Campus from Citigroup
- Jul 16, 2012
A fund affiliated with Brookfield Asset Management has acquired a 620,000-square-foot Class A office campus in the Dallas suburb of Irving, Texas, under a sale-leaseback with Citigroup, Brookfield announced Friday. No dollar value for the transaction was disclosed.
The 52-acre, three-building campus, located on Interstate 635 just outside Dallas-Fort Worth International Airport, was commissioned by Citigroup and completed between 2006 and 2007, a Brookfield spokesperson told CPE. The LEED-certified development was originally known as Citi Regent Campus and was formerly 100 percent occupied by Citigroup.
The campus, which has been renamed Regent Commons, is currently two-thirds leased by Citigroup and one-third vacant. Citigroup occupies one building on a long-term lease and a second building on a short-term lease; the third building is vacant, the spokesperson explained.
“The acquisition of this high-quality office campus offers significant upside potential for the fund in leasing the remainder of the space and is representative of our investing style, acquiring exceptional quality property from owner/users with a long-term lease-back on a portion of the space in markets in which we have considerable expertise,” commented David Arthur, the fund’s president and managing partner of Brookfield Real Estate Opportunity Fund II.
With only 620,000 square feet on 52 acres, the Brookfield spokesperson noted, “There is the potential for future development on the site,” but added that there are no specific plans to expand the complex at this time.
“Our commitment to the Dallas area is as strong as ever,” a Citigroup spokesperson told CPE. “We have approximately 8,000 employees and several locations in the area, and we continue to hire.”
A recent office market report from Marcus & Millichap Real Estate Investment Services Inc. emphasizes the Metroplex’s strong job growth, much of it in office-using businesses. Financial services companies are taking a major role in absorbing office space. Marcus & Millichap projects that the Dallas-area office vacancy rate will fall 120 basis points to 21.7 percent this year. Average asking rents are expected to rise 1.6 percent to $19.76 per square foot.