HRC acquires 20-story tower in Texas Capitol.
Located two blocks from the State Capitol Complex, the subject property features panoramic unobstructed views of the City, including the Capitol Building and the University of Texas and boasts a parking ratio of 3.2:1,000, the highest in the city's CBD. With efficient, rectangular 20,000- to 25,000-s/f floor plates, Capitol Tower lends itself to large users.
"Since 2002, the office market in Austin has shown impressive growth," remarked Spencer Garfield, managing director of HRC, a real estate opportunity fund manager. "City-wide direct vacancy decreased to 16% by yearend 2005, representing an 11% decrease in the amount of vacant space since year-end 2004."
"Austin is also a hot market for corporate relocations and expansions, surpassing national and state averages for employment growth," Garfield continued. A 24-hour neighborhood, Downtown Austin leads the city in employment, education and entertainment.
Constructed in 1985, the building is currently vacant except for Comerica Bank, which occupies 300 s/f and has a drive-thru in the garage, and MobilNet, which occupies 200 s/f. Property renovations include exterior glazing, new HVAC systems and a penthouse expansion and upgrades to the facade, lobby and garage.
"Pomeroy's real estate expertise made this an attractive transaction for us and will prove instrumental in managing and enhancing value in this investment," Garfield remarked.
"Pomeroy Investment is pleased to have Hudson Realty Capital join us in the redevelopment and leasing effort we are undertaking at Capitol Tower," added Gerald F. Reinhart, president and CEO of Pomeroy Investment Corporation.
"We have put together a great team of local and national talent to see the project through to completion," added Reinhart. "Christopher Enright Architects of Birmingham, Mich. is the designer architect while L.M. Holder III of Austin, TX, is the architect of record. Construction management services will be performed by Lago Builders of Austin, TX while the Austin office of Stream Realty Partners will be handling the leasing and on-site property management for the project."
"This time next year, when we have completed our work, Capitol Tower will figure prominently and proudly in the Austin city scape," concluded Reinhart.
Since the formation of HRC's initial two funds in 2002, the company has closed more than $1 billion in debt and equity transactions and expects to deploy another $400 million in 2006. Active nationwide, HRC focuses on distressed debt and preferred equity as well as complex bridge and mezzanine loan situations.
Activities include originating, participating in, servicing, restructuring and/or acquiring high-yield, special situation debt and mezzanine loans, as well as investing on a leveraged basis directly in real estate and acquiring under-performing real estate assets and other real estate-related instruments.
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|Publication:||Real Estate Weekly|
|Date:||Jul 19, 2006|
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