$90M Refinance Clears for 5 Houston Center

HOUSTON-Wells REIT II Inc. has secured a $90-million refinancing for the 580,175-sf 5 Houston Center in the CBD. The collateral is a landmark office building that’s 98% leased.

Des Moines-based Principal Real Estate Investors funded the loan for the Atlanta-based Wells Real Estate Funds, which bought the high rise at 1401 McKinney St. in late December 2005. Wells REIT II paid $166 million plus closing costs for the building, positioned on 1.43 acres. According to its SEC filing, the acquisition was funded with net proceeds from an ongoing public offering and assumption of a $90-million, fixed-rate loan through Irving, TX-based Archon Financial. The loan, carrying a 5% annual interest rate, was set to mature Oct. 1. Under the loan terms, Wells REIT was able to retire the debt after June 1 without a prepayment.