Top 10 Office Transactions in the Southern US

By Razvan Cimpean

Office transactions in the Southern U.S. have declined over the past several quarters, reaching $1.2 billion in 2017, down 16.7 percent from the previous year, Yardi Matrix data shows. Investment activity nosedived in Birmingham last year by almost 75 percent. More than 2 million square feet were sold here for only $145.1 million.

This year, 31 properties totaling 4.7 million square feet changed hands for almost $550 million, a per-square-foot average of $131. Most of it was concentrated in Nashville, where 1.8 million square feet traded for a total of roughly $380 million, although the metro’s price per square foot was 61 percent higher than the region’s average. Despite a constant increase in asking rates, Nashville is projected to remain the most active metro in the coming quarters, while emerging markets such as Louisville and Memphis will continue their ascending trend. 

10. 301 Center

This March, TechnologyAdvice paid Mertech Development roughly $7 million for the 99,894-square-foot 301 Center, located at 301 Plus Park Blvd. in Nashville, Tenn. Completed in 1972, the five-story building features nearly 500 parking spaces and offers easy access to interstates 24 and 440. The new owner selected Eakin Partners to lease the Class B office mid-rise, which is currently 4.8 percent vacant.

9. Executive Park

Priam Capital had a busy year so far, purchasing from Poe Cos. the 109,500-square-foot asset in Louisville, Ky., for $9.4 million, with the help of a $7.1 million acquisition loan held by Stock Yards Bank & Trust Co. Located at 100 Executive Park, the garden-style property was completed in two phases—in 1972 and 1993—and underwent cosmetic renovations in 1999. The one- and two-story building is situated near the intersection of interstates 264 and 64, as well as multiple public transportation options. The property includes a conference room and more than 400 parking spaces. As we reported last September, Priam Capital also acquired Intech Ten, a 116,000-square-foot office building in Indianapolis.

8. One Bridgestone Park

With the acquisition of the 66,264-square-foot asset, Yonezawa-Miller Co. entered the Nashville office market. W.P. Carey sold the three-story building to the Diamond Bar, Calif.-based firm for $12.6 million, in a transaction subject to a $9.1 million loan provided by Wells Fargo Bank. Located at 1 Bridgestone Park, the asset offers convenient access to multiple bus stations and restaurants, including Mirko Pasta, Pie Five Pizza and Jersey Mike’s Subs. Completed in 1988, the building was fully renovated in 2015 and includes 530 parking spaces. Recently, W.P. Carey acquired a Denmark-based portfolio of 14 logistic properties and one corporate headquarters.

7. Lakecrest III

Priam Capital’s second acquisition on this list is the 134,000-square-foot Lakecrest III, for which the Nashville-based company paid Lone Star Funds $14.1 million. The sale was completed with the help of a $9.3 million loan from First Tennessee Bank. The new owner selected CBRE to manage the property, while Cushman & Wakefield is in charge of leasing duties. The garden-style, four-story building, completed in 1983, is situated at 6060 Primacy Parkway in Memphis, about 2 miles from Interstate 240 and next to Loehmanns Plaza Shopping Center and Ridgeway Trace.

6. Overlook Office Building

Almost three years after acquiring the 68,174-square-foot asset, Southeast Venture sold it to Butler Snow for $15.5 million. Completed in 1988 and renovated in 2008, the property is located at 214 Overlook Circle in Brentwood, Tenn. The new owner picked Southeast Venture to handle management and leasing responsibilities. The Class B building offers 239 parking spaces and easy access to Interstate 65. Additionally, Overlook Office Building is situated within a few minutes of multiple restaurants and hotels, including Mazatlán Restaurant, Peter’s Sushi & Thai and Extended Stay America.

5. 150 Second Ave. N.

Coming in at No. 5 is The Ardent Co.’s acquisition of the 88,170-square-foot office building at 150 Second Ave. N. In January, Cushman & Wakefield sold the asset for $23 million in a deal subject to a $13.8 million loan from CapStar Bank. The seller continues to provide management and leasing services. The four-story property includes 18,000 square feet of retail space and is located near bus stations, restaurants and hotels, such as The Old Spaghetti Factory, The Melting Pot and Courtyard by Marriott.

4. AT&T City Center

In a $29.3 million deal with JPMorgan Asset Management, RVI Group purchased the 617,500-square-foot asset at 600 19th St. N. in Birmingham, Ala. The 30-story building, completed in 1971, was fully renovated in 1998. The tower is situated next to Linn Park and Kelly Ingram Park, multiple public transportation options and about 1.5 miles from Interstate 20. Last year, AT&T announced that it will move its employees to 1876 Data Drive in Hoover.

3. Comdata Headquarters

The 201,000-square-foot asset changed hands in the first month of the year, as part of a multi-state portfolio sale in which Bridge Investment Group acquired 13 properties from Piedmont Office Realty Trust totaling more than 2 million square feet of office space and 6,000 square feet of retail space. The one- and three-story building, situated at 5301 Maryland Way in Brentwood, Tenn., serves as Comdata’s headquarters, which occupies it in its entirety. Bridge Commercial Real Estate manages the property, while Cushman & Wakefield handles leasing services. Located roughly 2 miles from Interstate 65, the asset offers convenient access to multiple hotels, including Courtyard by Marriott and Hilton Garden Inn, while downtown Nashville is within a 20-minute drive. Bridge Investment Group is also one of the largest San Francisco office buyers.

2. One Greenway Centre

This February, Jackson National Life Insurance paid $42.5 million to OBP Partners for the 155,000-square-foot asset in Franklin, Tenn. The deal was subject to a $24.5 million acquisition loan from Great American Life Insurance Co. The office mid-rise, completed in 2008, is LEED Gold and offers more than 600 parking spaces. The property is located at 300 Innovation Drive in Franklin, Tenn., about 1.5 miles from Interstate 65 and 9 miles from Interstate 840. One Greenway Centre is situated in the vicinity of multiple restaurants and hotels, such as BrickTop’s, Embassy Suites by Hilton and Residence Inn by Marriott.

1. Caterpillar Financial Center

Caterpillar’s acquisition of the 312,000-square-foot high-rise in Nashville from Piedmont Office Realty Trust tops our list. Part of a $90 million portfolio sale, the transaction incorporated more than 450,000 square feet of office space in Tennessee and Virginia. The garden-style asset, completed in 1999 and located at 2120 W. End Ave., is LEED Gold certified and features more than 400 parking spaces. Situated in the Music Row-Vanderbilt submarket, directly across the street from College Halls Kissam, the asset offers easy access to various public transportation, shopping and dining options.

Images courtesy of Yardi Matrix