OA Development has purchased The Park-Huntersville portfolio for $62.5 million. The 395,796-square-foot, five-building Class A portfolio is in the heart of the North Charlotte submarket and is the largest multi-story suburban office portfolio in the supply-constrained Northeast/I-77 corridor. HFF marketed the property on behalf of the seller, U.S. Trust – Bank of America N.A., as trustee, and procured the buyer. Patterson Real Estate Advisory Group arranged the acquisition financing with Principal Real Estate Investors. The deal follows Bank of America N.A.’s sale of four Charlotte-area buildings, which include more than 400,000 square feet of space within The Park—Huntersville.
The Park is in close proximity to UNC Charlotte, Central Piedmont Community College, Queens University, Davidson College and just minutes from the Lake Norman area. The Park’s purchase price of $158 per square foot is below replacement cost, which is estimated to be between $230 and $245 per square foot.
The portfolio is part of a commercial park with more than 1 million square feet of office, industrial, flex, retail, medical, and soon-to-be hospitality properties. At the time of the sale, the property was 91.4 percent occupied, institutionally maintained and comprised regional, national and international companies from a wide array of industries—including business services, health care, technology and manufacturing.
Solid tenant roster
The property has experienced positive leasing momentum, with more than 60,000 square feet of new leases and renewals in the last two quarters. Currently, 34 percent of the tenants maintain investment-grade credit with more than four years of average weighted remaining lease term, and rents presently sit at 14.1 percent below marketplace rents.
Charlotte is one of the fastest-growing cities in the United States. Strong in-migration, a thriving job market and several public investments have stimulated capital injections. In its third-quarter Charlotte report, Cushman & Wakefield noted that the market’s robust growth ranks third nationally, with more than 1 million residents employed, which has pushed unemployment rates down to 3.8 percent.
The Spectrum Cos. will continue to provide leasing and management services for the buildings. The portfolio transaction marks the company’s largest acquisition to date. This is the 19th commercial property that OA Development has acquired in the last nine years, bringing the company’s total square footage acquired to 2.8 million square feet. The HFF investment advisory team representing the seller consisted of Senior Managing Director Ryan Clutter, Senior Director Scot Humphrey and Director Chris Lingerfelt.
Images courtesy of Yardi Matrix