Hertz Investment Acquires 807 KSF Houston Office Campus
- Feb 22, 2018
Hertz Investment Group has made its second Houston office purchase in recent months from Parmenter Realty Partners, this time acquiring the three-building, Class A Brookhollow Central I, II and III portfolio in the city’s North Loop submarket for $70.5 million.
The purchase of the 806,541-square-foot campus at 2800, 2900 and 2950 North Loop West comes about a month after the Woodland Hills, Calif.-based company picked up Westchase Park Plaza, a 10-story, 232,108-square-foot building at 11490 Westheimer, for $24 million, also from Parmenter.
“Hertz Investment Group feels strongly about the strength and future of the Houston office market. Houston is a leader in population and economic growth, and companies are looking to locate in the city. We believe Brookhollow Central is well positioned with its location between the city’s ever-expanding business district and highly desirable residential neighborhoods,” Judah Hertz, chairman & CEO of Hertz Investment Group, said in a prepared statement.
HFF’s Investment Advisory team, led by Senior Managing Director Dan Miller and Senior Director Marty Hogan, represented the Miami-based seller and procured the buyer.
The Brookhollow Central properties are located at the newly reconfigured intersection of Interstate 610 and U.S. Highway 290, just north of Houston’s Galleria submarket, which has more than 400 retail stores and restaurants. The site is also near some of the city’s most affluent neighborhoods, including River Oaks, Tanglewood and Memorial Villages.
Brookhollow Central I, the oldest of the buildings with a construction date of 1972, was “completely rebuilt in 2014 and nearly $16 million [were] spent on base building improvements,” according to HFF. At the time Parmenter bought the property in 2012, the building was empty and renovated. The other buildings also had some cosmetic improvements made about 2012, according to Yardi Matrix.
The 12-story Brookhollow Central I building has about 200,800 square feet of space with a vacancy rate of 20.7 percent. Current tenants include Cigna and Ethos Energy.
Brookhollow Central II, was constructed in 1979 and has 304,576 square feet of space across 14 stories. The building, which has a vacancy rate of 12.7 percent, has a tenant roster including Cigna, Comerica, Lorance & Thompson and OneHouston Financial.
The 12-story Brookhollow Central III, was built in 1980 and comprises 300,616 square feet. It features two restaurants and a fitness center available to tenants from all three buildings. The property has a vacancy rate of 36.3 percent, and includes Comerica, Amerapex, Godsey & Martin, HNTB Corp., Universal Fluid Services and Daiichi Jitsugyo America among its tenants. Regus operates executive suites in the building.
Two years ago, HFF arranged a $64.2 million refinancing for Brookhollow Central I, II and III, placing the loan with MetLife Real Estate Investors on behalf of Parmenter. That interest-only loan was used to refinance the existing debt and provide capital for future tenant improvements, leasing commissions and capital expenditures.
The original $55 million loan on the property was provided by CIBC to help Parmenter finance the estimated $71 million acquisition of the three-building Houston office complex from Thomas Properties Group, according to Yardi Matrix data.
Image courtesy of HFF