The portfolio of single-tenant buildings in Houston and Dallas/Fort Worth came to market in November 2003. An AmREIT contact has confirmed that the 39,886-sf package brought slightly less than the $5-million asking price. The deeds turned at a 9% cap rate.
The AmREIT spokeswoman says the portfolio was owned by a retail partnership fund with a defined hold period. "It was time to wrap it up," she says of the motivation to close out the fund's assets.
Tenel Tayar, AmREIT's vice president of acquisitions, says the deal included the transfer of a fully amortized note with a $90,000 balance and 10% interest rate to the portfolio buyer. The note, sold at face value, will generate $3,000 per month through October 2006. AmREIT acquired the note six years ago when it sold a 3,000-sf building in Clute to a franchisee for Atlas Transmission.
Don Stringham, investment specialist with the Houston office of Marcus & Millichap, tells GlobeSt.com that six would-be buyers from California, Illinois and Texas tossed hats into the ring for the portfolio. The buildings range from 2,200 sf to 6,600 sf, with lease expirations running from May through 2019.
In Sugar Land, the buyer got a pair of La Petite Academy schools: 6,771 sf at 4502 Austin Parkway and 5,998 sf at 2229 Settlers Way. The Austin Parkway lease expires in 2008 and Settlers Way in 2009. Within the Houston city limits, the buyer won deeds to a 6,600-sf building at 2700 S. Loop West, which is leased through 2012 to Bennigan's; and a two-building center, totaling 3,381 sf, at 8110 and 8115 Southwest Freeway, leased to Church's Chicken through 2012, Superior Sound through May 2008 and Gannett Outdoors through 2019. In the Dallas area, the assets are a 5,772-sf building at 1818 Hillcrest Road and a 5,824-sf structure at 2539 Marsh Lane, both leased to Goodyear Tire Co. The leases expire in May 2005, but Stringham says the franchisee has "expressed a desire to stay" although renewals have yet to be signed.
On the western side of the Dallas/Fort Worth metroplex, the trade included a 3,340-sf building at 6800 Camp Bowie Blvd., leased to Discount Tire Co. through 2005, and a 2,200-sf structure at 421 W. Pioneer Parkway in Grand Prairie, where Whataburger is in place until 2006.
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