Raleigh-Area Office Campus Fetches $69M
- Nov 05, 2018
With the assistance of commercial real estate and capital markets services provider HFF, Crescent Lakeside LLC recently sold Crescent Lakeside I & II, a 255,000-square-foot office campus in the metropolitan Raleigh city of Cary, N.C. HLM Realty LLC paid the seller $69 million for the Class A asset, which boasts a location in central North Carolina’s coveted Research Triangle.
HLM faced more than a little competition for Crescent Lakeside I & II. “We received significant interest in Crescent Lakeside from numerous capital sources representing a diverse group of investors,” Ryan Clutter, a senior managing director with HFF, said in a prepared statement.
Capital Associates and Boddie-Noell Enterprises developed Crescent Lakeside I & II at The Crescent mixed-use development between 2001 and 2009. Crescent Lakeside I is a three-story structure featuring 109,000 square feet at 1225 Crescent Drive and the 146,000-square-foot Crescent Lakeside II stands four stories tall at 1255 Crescent Green Drive. Together, the buildings boast an occupancy level of 98.9 percent, with a host of credit-worthy businesses on the tenant roster.
HFF’s Scot Humphrey, Chris Lingerfelt and Zack Drozda joined Clutter in the representation of Crescent Lakeside LLC in the transaction. Frank Baird, CEO of Capital Associates Management, joined the HFF investment advisory group on the seller’s side as well.
Raging sales in Raleigh
The group of hopeful buyers that flocked to the Crescent Lakeside properties is indicative of the current state of the investment sales market across the Research Triangle. Commercial real estate sales volume totaled $3.9 billion during the first three quarters of 2018, marking an increase of 27 percent over the same period in 2017, according to a third quarter 2018 report by commercial real estate services firm Avison Young. The year-over-year percentage increase in sales volume was even more remarkable in the office sector, where sales skyrocketed 130 percent.
A notable portion of office trades in the third quarter occurred in metropolitan Raleigh. Preferred Office Properties picked up the roughly 560,000-square-foot Wells Fargo Capitol Center for $173 million and Brookdale Group acquired WestChase I, II & III, a 313,000-square-foot campus, in a $56.3 million transaction. Additionally, Singapore’s Ascendas-Singbridge Group made its entrée into the U.S. real estate market with the acquisition of a national portfolio that included the approximately 1.2 million-square-foot Perimeter Park Portfolio, which carried a price tag of $314 million. There’s no hint of a slowdown in the activity.
“As job and population growth in the Triangle continue to outpace most of the country, we believe investor demand for the region will only intensify as we head into 2019 and beyond,” Clutter said.
Image courtesy of HFF