One Briarlake Plaza

Houston, Texas

Historical Transaction

NRSF: 502,410
Total Capital: $74.4 million
Equity Invested: $24.4 million
Status: Sold
Realized Multiple: 3.9x
Realized IRR: 35%

One Briarlake Plaza is a 20-story office tower (“OBLP”) that was developed in 2002 and is located in the Westchase submarket of Houston. OBLP was purchased in 2003 to capitalize on the high demand for Class A office space in Houston’s Westchase submarket. The submarket continued to benefit from an outstanding local economy driven by the Energy, Financial Services, and Manufacturing industries. OBLP outperformed the submarket in both rental rate and occupancy.

Opportunity

  • Off-market transaction from seller exiting the market – core office product with steady cash flows and minimal rollover in the first 3 years. Also acquired Phase II land totaling 6 acres.
  • Capitalize on high quality finishes, efficient floorplate, floor-to-ceiling glass, and unobstructed views to lead market in rents and occupancy.
  • Market research projected tightening in submarket with increases in rental rate and occupancy. In addition to its physical advantages, OBLP’s prominent location, ease of access, and proximity to upscale neighborhoods would allow OBLP to capitalize on this increased demand.

Value Enhancement Strategy

  • Proactively renewed two major tenants, including one not scheduled to expire for three years. In doing so, increased weighted average lease term from 4.5 years to over 7 years.
  • Ownership implemented a leasing strategy that raised occupancy from 89% to 94% upon sale.
  • Sale of excess land (with design constraints) yielded 3 times initial basis.