Belay, Harbor Associates Buy 2 Office Assets for $57M

700 N. Central Ave.

Belay Investment Group LLC and Harbor Associates LLC recently partnered on the acquisition of two value-add office assets encompassing an aggregate 302,000 square feet in transactions totaling $56.9 million. In separate joint ventures, the companies snapped up 700 N. Central Ave. in the suburban Los Angeles city of Glendale, Calif., part of the Tri-Cities market, as well as Capitol Center in Denver.

“Both properties present us with an opportunity to make strong risk-adjusted returns through strategic renovations that focus on improving the tenant experience in partnership with an experienced sponsorship team in markets that we believe have significant room to grow,” Eliza Bailey, managing principal with Belay Investment Group LLC, said in a prepared statement. Belay funded its stake in the joint ventures through Belay Partnership Ventures II LP, a fund capitalized by the California State Teachers’ Retirement System.

Belay and Harbor purchased 700 N. Central, a 136,000-square-foot building in the Glendale Gateway office complex, from CBRE Global Investors for $28 million. The eight-story property first made its debut in 1979. The partners acquired the 166,000-square-foot Capitol Center from SteelWave in a $28.9 million deal. Developed in 1958, Capitol Center consists of a 12-story structure connected to a two-story-building.

For both assets, the change in ownership comes within two years of their previous trading. The 700 N. Central property previously sold in late 2017, while Capitol Center last saw a change in its ownership team in 2016.   

Adding value

Both Belay and Harbor focus on value-add opportunities, but the companies have certainly faced greater competition from the investment community this year. Fifty-eight percent of respondents to global commercial real estate marketplace Real Capital Markets’ 2018 investor sentiment survey defined themselves as value-add investors.

“There is general agreement that the focus will continue to center on value add, in spite of the real shortage of attractive opportunities,” according to the report based on the Real Capital Markets survey.

“With so much capital on the sidelines—and plenty of investors wanting and needing to deploy it—value add was noted as the predominant investment approach going into 2018.”

Image courtesy of Yardi Matrix