Highwoods Properties Closes $201M Office Tower Acquisition

650 South Tryon at Legacy Union. Image courtesy of Lincoln Harris

A partnership between Lincoln Harris and Goldman Sachs Asset Management has completed the disposition of 650 South Tryon at Legacy Union, a 367,000-square-foot office building within Charlotte’s central business district.

Highwoods Properties Inc. paid $201.2 million for the LEED Gold-certified tower, Mecklenburg County records show, following the purchase agreement announced in May, which pointed to a total investment of $203 million.

The total investment includes $5.2 million for potential leasing expenditures aimed at stabilizing the multi-tenant property and excludes $3.7 million rent-related costs provided by the sellers.

Lincoln Harris will continue to oversee management and leasing operations at the 18-story building. Meanwhile, Highwoods secured a $118.4 million self-financed loan for the purchase, according to public records.

In the first seven months of the year, 19 office properties totaling 1.9 million square feet traded in a 15 mile-radius from the high-rise also known as Legacy Union SIX50, CommercialEdge data shows. The sales volume amounted to more than $634.5 million or $346.12 average sale price per square foot, below the $548.3 price per square foot shelled out by Highwoods.

Notable transactions included the $206 million acquisition of The Line, a recently completed 16-story office building totaling 305,000 square feet in the city’s South End neighborhood. CBRE Investment Management purchased the Gensler-designed property.

In May, Crestlight Capital paid $192.5 million for the two-building 526,650-squrae-foot office campus dubbed SouthPark Towers. The buyer financed the purchase with a $167.8 million acquisition loan originated by Mesa West Capital.

The third office tower within Legacy Union

650 South Tryon at Legacy Union. Image via Google Street View

650 South Tryon at Legacy Union features a cantilevered glass facade, 23,800-square-foot floorplates and also includes 10,208 square feet of retail space. The high-rise at 650 S. Tryon St. shares a parking structure with the adjacent Bank of America Tower.

650 South Tryon at Legacy Union is the third office tower sold by Lincoln Harris and Goldman Sachs Asset Management within the 10-acre Legacy Union, on the former site of the Charlotte Observer. The co-developers traded Honeywell’s global corporate headquarters last December for $275 million. PRP Real Estate Investment acquired the 23-story tower totaling 373,921 square feet.

The tallest building, the 868,064-square-foot Bank of America Tower, was also acquired by Highwoods Properties. The company paid $441.6 million in late-2019 for the 33-story high-rise. In July, Lincoln and Goldman announced plans for a fourth office tower at Legacy Union. Designed by LS3P, the 24-story high-rise will take shape at 600 S. Tryon St.

At the time of the sale, the tower was 79 percent leased to a roster that includes Deloitte, Cadwalader Wickersham & Taft, as well as JLL. Recently, The Bank of London announced plans for a second U.S. hub, less than half a mile away. The bank signed a 40,000-square-foot lease at One Independence Center.