JV Acquires Stake in Houston’s Greenway Portfolio

By IvyLee Rosario

Nine Eleven and Twelve Greenway Plaza

The joint venture of TH Real Estate and Silverpeak Real Estate Partners completed the acquisition of a 24.5 percent interest in Greenway Plaza and Phoenix Tower in Houston, in a transaction that brings the Greenway Portfolio to $1 billion. The portfolio comprises 11 office assets totaling five million square feet across 54 acres.

The two companies are investing on behalf of TIAA General Account, Silverpeak and other domestic and international institutional investors, two of which have invested through LaSalle Investment Management. Canada Pension Plan Investment Board also completed the purchase of a 24.5 percent stake in the portfolio. The seller, an affiliate of Parkway Inc., retained a 51 percent stake and will continue to be responsible for property management and leasing activities for the portfolio.

Phoenix Tower

The joint venture assumed the existing mortgage debt secured by Phoenix Tower, which has an outstanding balance of $76 million and matures on March 1, 2023. The joint venture also placed a new mortgage loan from Goldman Sachs totaling $465 million secured for the other properties in the Greenway Portfolio, which has a fixed interest rate of 3.8 percent and matures on May 6, 2022. HFF arranged the recapitalization and secured financing for the Greenway Portfolio.

“Houston is one of the most populous regions in the US and has strong economic activity driven by a variety of industries including energy, healthcare, education, logistics and transportation,” said Mike Fisk, managing director & head of strategic transactions at TH Real Estate, in prepared remarks. “It’s a market that has demonstrated resilience throughout past cycles and historically been a strong total return performer relative to other gateway markets over longer time periods.”

Images courtesy of TH Real Estate & Silverpeak Real Estate Partners