HFF on behalf of Oaktree / Banyan announce sale of Concourse Lakeside I & II in Raleigh, North Carolina to Foundry Commercial and Hart Realty Advisers
New owners to upgrade asset, attract new and retain existing tenants in Research Triangle submarket
CHARLOTTE, NC - September 19, 2017 – Holliday Fenoglio Fowler, L.P. (HFF) and Foundry Commercial announce the $24.2 million sale of Concourse Lakeside I and II, a two-building, Class A office property totaling 154,553 square feet in the Raleigh-Durham community of Morrisville, North Carolina.
The HFF team marketed the property on behalf of the seller, a partnership affiliate of Banyan Street Capital and funds managed by Oaktree Capital Management and procured the buyer, Foundry Commercial, along with capital partner Hart Realty Advisers, LLC on behalf of a separate account client. Foundry and Hart plan on updating the 154,553-square-foot, Class A office assets to include base building upgrades and additional amenities to retain and attract new tenants.
Concourse Lakeside is currently 89 percent leased to local and national corporations, including Aetna Life Insurance Company, The Redwoods Group, and TransAmerica, but will drop to 74 percent by year-end pending the expiration of the largest tenant. Located in Morrisville within the Research Triangle Park (RTP) submarket, the offices are ideally located on Slater Road with direct access to Interstates 40 and 540, Raleigh Durham International Airport and superior connectivity to the surrounding Raleigh-Durham metropolitan area. The submarket has seen significant large corporate relocations and expansion resulting in increasing rental rates, tightening vacancy rates and new speculative and built-to-suit activity. Concourse Lakeside is situated in the Research Triangle’s largest submarket, RTP/I-40, which has continued to experience declining vacancy despite more than 660,000 square feet in recently delivered office space.
The HFF investment sales team representing the seller included senior managing director Ryan Clutter, senior director Scot Humphrey and director Chris Lingerfelt.
“Concourse Lakeside represents a significant value-add opportunity as a result of having newly-vacated space in a flourishing Raleigh-Durham market that continues to demonstrate exceptional job growth,” said Humphrey.
“Of all the markets within the Foundry footprint from North Carolina to Texas, Raleigh-Durham boasts the strongest real estate fundamentals, an attractive balance of supply and demand and remains top ranked in population growth, job growth, and corporate investment. The market checks every major box within our investment criteria. Our approach lined up nicely with Hart and we’re excited at the opportunity to complement our existing services platform in the region,” said Bill Simerville, Foundry Managing Director of Capital Markets.
With a balanced mix of small and large availabilities, Foundry and Hart anticipate base building upgrades of roof and HVAC and may include general common area upgrades, new tenant amenities, outdoor patio and, a café or snack station. Ownership will explore every opportunity to maximize the tenant experience and compete with the newer product within the submarket.
Concourse represents the first acquisition for both Foundry and Hart in Raleigh. Over the last three years, Foundry Commercial has acquired $700 million in assets across the Southeast, totaling 7.1 million square feet. Foundry Commercial currently has 1.5 million square feet of institutional industrial product under development in Charlotte.
Holliday Fenoglio Fowler, L.P. acting by and through Holliday GP Corp, a North Carolina licensed real estate broker.
About Foundry Commercial
Foundry Commercial is a full-service real estate services and investment company with 270 employees and more than 45 million square feet of management and leasing across the Southeast and Texas. Foundry provides corporate services, brokerage, leasing, building management and project management services, and is the largest real estate service provider to religious and not-for-profit organizations in the Country. Foundry also includes a development and investment platform that is fully integrated into its services business, leveraging its local market expertise to control nearly $700 million in advantaged investment opportunities in partnership with its clients. Foundry Commercial was founded as CNL Commercial Real Estate in 2007 and launched as Foundry in 2015 through a management-led buyout. For more information, visit foundrycommercial.com.
About Hart Realty Advisers
Founded in 1982, Hart Realty Advisers, LLC is a closely held real estate investment management firm specializing in private equity core and value-added solutions. The firm provides customized investments for its institutional clients so that their unique risk and diversification requirements are best matched with opportunities in the marketplace. Hart has acquired approximately $2.0 billion of real estate on behalf of their institutional clients. Hart Realty Advisers, LLC is an institutional real estate advisor located in Simsbury, CT. For more information, visit hartadvisers.com.
About Banyan Street Capital
Banyan Street Capital is a private equity firm focused on acquiring and managing office properties directly or in joint ventures with institutional capital partners. With a concentrated presence in the Eastern United States, the company capitalizes on the team’s experience and expertise to remain at the forefront of today’s emerging economic growth and investment strategies. Banyan Street Capital’s mission is to implement strategies that add value and deliver high risk-adjusted returns to its investors. More information about Banyan Street Capital is available at banyanstreet.com.
About Oaktree Capital Management
Oaktree is a leader among global investment managers specializing in alternative investments, with $98 billion in assets under management as of September 30, 2016. The firm emphasizes an opportunistic, value-oriented and risk-controlled approach to investments in distressed debt, corporate debt (including high yield debt and senior loans), control investing, convertible securities, real estate and listed equities. Headquartered in Los Angeles, the firm has over 900 employees and offices in 18 cities worldwide. For additional information, please visit Oaktree’s website at oaktreecapital.com.
HFF and its affiliates operate out of 24 offices and are a leading provider of commercial real estate and capital markets services to the global commercial real estate industry. HFF, together with its affiliates, offers clients a fully integrated capital markets platform including debt placement, investment sales, equity placement, funds marketing, M&A and corporate advisory, loan sales and loan servicing. Holliday Fenoglio Fowler, L.P., HFF Real Estate Limited (collectively, “HFF”), HFF Securities L.P. and HFF Securities Limited (collectively, “HFFS”) are owned by HFF, Inc. (NYSE: HF). For more information please visit hfflp.com or follow HFF on Twitter @HFF.