(Read more on the industrial market.)
HOUSTON-Mountain West Industrial Properties has closed on the 149,735-sf Colony Crossing Business Center in southwest Houston. Comparable flex industrial projects have been drawing roughly $65 per sf at sale time.
The new owner is starting out with a new tenant in hand for the now 47%-leased, two-building asset at 10207-15 S. Sam Houston Pkwy. T.J. Tarbell, acquisition and development officer for the Denver-based investment group, says he can't divulge the new tenant's name, as yet, but the new deal was part of the marketing strategy by the Houston team of Kyle Valentine and Justin Robinson with Dallas-based Stream Realty Partners LP. The lease was signed just days before the purchase, according to Tarbell. The to-be announced tenant is planning a first quarter move-in, getting a spot alongside LS Motorsports LLC.
Tarbell tells GlobeSt.com that the acquisition was financed with a three-year loan at a fixed-rate interest through Guaranty Bank & Trust of Denver. The acquisition is Mountain West's second one this year in the southwestern sector, where it bought 337,377 sf in four properties in March in a two-mile radius. Also in late October, the investment group bought Cedar Crossing, a 129,568-sf distribution center in Baytown.
"We like the southwest submarket," Tarbell says, "and we like the dynamics of the Houston industrial market." David Boyd of Boyd Commercial in Houston and Darryl Noon of locally based Transwestern Commercial Services represented Mountain West, which is planning a two- to four-year hold.
Mountain West bought Colony Crossing Business Center from a joint venture of Cadence McShane Corp. of Dallas and New York City-based MetLife. The JV completed the 7.45-acre development in fourth quarter 2006.
Tarbell says Colony Crossing's frontage on Beltway 8 weighed heavily on the decision to join in the chase for the property. "Both buildings have beltway frontage and visibility, which is a plus in our book," he explains. "They fit really well for the types of deals that we're looking at, given the vacancy." Noon and Transwestern Commercial Services' Brian Gammill will lead the leasing and management team.
With the deal put to bed, Tarbell is looking ahead. Mountain West has allocated $200 million to acquire properties in 2008 in its core markets, which also include Dallas, Denver, Phoenix and Seattle. "My hope is 50% of that will be spent in Houston," he says.
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