Local Consortium Buys Houston Office Campus
JLL represented the seller, a court-appointed receiver.
LFFP Ashford Portfolio LLC, a consortium led by a Houston-area family office, has acquired a three-property, 570,045-square-foot office campus in Houston’s Energy Corridor. JLL represented the seller, a court-appointed receiver, and procured the buyer.
As part of the deal, LFFP also assumed the outstanding balance of a $61.1 million CMBS loan. That balance amounted to $46.6 million, according to The Real Deal.
Completed from 1980 through 1982, the campus comprises Ashford 5 at 14701 St. Mary’s Lane; Ashford 6 at 1155 Dairy Ashford Road and Ashford 7 at 900 Threadneedle St. The property is adjacent to Interstate 10 and near Beltway 8, providing ready access to the Houston metropolitan area.
Led by businessman and entrepreneur Mohammed Ali Lakhany, LFFP acquires and manages office properties in the Energy Corridor. In addition to the Ashford Portfolio, the firm recently purchased Westgate II, also on I-10, just west of Highway 6.
A Houston office portfolio
Accesso Partners had acquired the portfolio from Falcon Southwest in August 2012, according to information provided by CommercialEdge. That same month, the property became subject to the CMBS loan in the pool J.P. Morgan Chase Commercial Mortgage Securities Trust 2012-C8. The note was interest-only at a rate of 4.81 percent, with a due date set for Aug. 1, 2022.
However, Accesso failed to pay off the loan in time and the buildings were sent to special servicing in 2022. The special servicer was Midland Loan Services, The Real Deal reported.
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Renovated between 2014 and 2016, the eight-story campus features a fitness center, tenant lounges and separate parking garages for each building. The assets were 58 percent leased overall at the time of sale.
JLL’s Marty Hogan and Kevin McConn led the Capital Markets Investment Sales and Advisory team representing the seller. In addition, the firm’s Rick Goings, John Ream and Clay Anderson assisted the buyer in the assumption and modification of the loan.
Slow recovery
As is true in so many office markets nationwide, Houston’s is seeing its recovery being led by trophy assets, according to a first-quarter report from Avison Young. Overall, the vacancy rate declined by 60 basis points to 26.8 percent. Total availability in the Energy Corridor was 27.6 percent.
According to Avison Young, the office transaction volume has experienced a noticeable uptick in activity over the past six months, as investors pursue assets at adjusted valuations. Sales reached $277 million in the first quarter of this year, as buyers seized opportunities to acquire heavily discounted properties.
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