Easterly Partners Acquires Two-Building New Mexico Portfolio Leased to U.S. Forestry Service

There is nothing like a property fully leased to a government entity to provide an investor with security, and that is exactly what Easterly Partners got with its acquisition of a 191,200-square-foot office portfolio in Albuquerque, N.M.

December 16, 2011
By Barbra Murray, Contributing Editor

There is nothing like a property fully leased to a government entity to provide an investor with security, and that is exactly what Easterly Partners got with its acquisition of a 191,200-square-foot office portfolio in Albuquerque, N.M. The real estate investment management firm snapped up the two-building asset, occupied in its entirety by the U.S. Forest Service under a long-term lease agreement, from Titan Development

Located in the Journal Center Business Park, the complex consists of Masthead I and Masthead II, which Titan developed in 2006 and 2011, respectively. The first building is a three-story structure featuring 92,500 square feet on a nearly six-acre parcel at 3900 Masthead. Eventually, however, the build-to-suit facility was not quite enough to accommodate USFS’s needs and the agency called on Titan again to develop another three-story building, the 98,700-square-foot Masthead II. Carrying the address of 4000 Masthead, the second building occupies a four-acre site and reached completion at a cost of $20 million.

Marcus & Millichap Real Estate Investment Services marketed the portfolio on Titan’s behalf. “The Albuquerque U.S. Forest Service office campus is an extremely well-built facility that houses critical national administrative functions for USFS operations,” Travis Trautvetter, a vice president of investments and director of the firm’s National Office and Industrial Properties Group, said. “Many aspects of this investment made it highly desirable, including the long-term leases that were in place with the federal government, new construction, exceptional design and the ideal Journal Center location within Albuquerque. As such, we were able to orchestrate a very competitive bidding environment for these assets.”

Easterly relied on Perseus Realty Capital L.L.C. to assist in arranging a 15-year permanent financing package in the amount of $17.5 million for the purchase of the portfolio. “The Masthead properties represent what many buyers and lenders are looking for in today’s market, long-term leased assets to credit type tenants with strong annual cash flow and optimal debt service coverage,” Lindsay Stroud, a director with Perseus, said when announcing the news in November.