TIER REIT Buys Big in TX, Sells in KY
- Jun 27, 2017
TIER REIT Inc. purchased a 319,000-square-foot Class A office asset located in the amenity-rich Legacy Town Center area of Plano, Texas, for $123.3 million and sold the company’s Louisville, Ky., portfolio, including five properties, for a price tag of $71.5 million.
Located at 5851 Legacy Circle, the 12-story office building completed in 2012 is situated in close proximity to Dallas North and Sam Rayburn tollways. According to Yardi Matrix data, the asset last traded in 2012, when VEREIT acquired the property from KDC for $120 million. The sale was subject to a $66 million CMBS loan with a 4.24 percent fixed interest and a maturity date of 2033. TIER’s acquisition includes the assumption of the loan. The property features common area Wi-Fi, high ceilings and ample parking in the multi-level parking structure adjacent to the building.
At the time of the transaction, 5851 Legacy Circle was 100 percent master-leased to Encana Corp. and more than 88 percent subleased to companies such as LegacyTexas Bank, U.S. Renal Care and Aimbridge Hospitality. The property is contiguous to two land parcels that TIER acquired in 2015, which can accommodate two additional office towers with an aggregate of 570,000 square feet. The project is being rebranded as Legacy District.
“This acquisition complements our existing development parcels and enhances our vision for Legacy District, given its strategic location in the heart of the vibrant live-work-play Legacy submarket,” said Scott Fordham, president & CEO of TIER REIT, in a prepared statement. “Further, it plants our flag prominently near the exciting new corporate campuses of Toyota, JP Morgan, Liberty Mutual and FedEx Office, which combined should bring over 15,000 new office workers to the submarket.”
TIER Sold its 678 KSF Louisville Portfolio
The $71.5 million portfolio that TIER recently sold encompasses approximately 678,000 square feet of office space in five buildings. The largest property from the portfolio is Forum Office Park, a 327,811-square-foot campus-style four-building office complex situated on a 22-acre site in the popular Hurstbourne/Lyndon submarket.
Hunnington, Lakeview, One Oxmoor Place and Sleeplechase Place are the remaining properties from the traded portfolio and range between 61,862 and 134,926 square feet of office space. Built in the late 1980s, One Oxmoor Place and Sleeplechase Place were renovated in 2005-2006. Hunnington was renovated in 2013.
“Our exit from the Louisville market is another important milestone for TIER REIT,” added Fordham, “and our reallocation of capital from Louisville and into Legacy District is another example of our strategic recycling efforts.”
TIER REIT and Westbrook Partners recently sold two office buildings in Washington, D.C.’s East End submarket for $259 million, the transaction reflecting the company’s continuing strategy of exiting non-target markets.
Images courtesy of Corgan and TIER REIT