LOS ANGELES—Hertz Investment Group has purchased a six-property class-A office portfolio for $417.4 million from Equity Commonwealth. The purchase is the company's largest to date. The portfolio totals more than 3 million square feet of office space and all of the properties are in the Southeast region of the US.

“This portfolio is right down the fairway of what we do,” Jim Ingram, EVP and CIO of Hertz Investment Group, tells GlobeSt.com. “We are not interested in investing in the larger markets. We like the small- to medium-sized CBD markets, so we are never going to invest in New York or Chicago or Boston. If you track what we have done historically and then look at this portfolio, it is spot on for what we do. Not only do you have great real estate, but you have a great rent roll in each of these assets.”

The properties purchased include: One Shell Square, a 51-story, 1.3 million square foot tower in New Orleans' CBD; Wells Fargo Tower, a 30-story 514,893-square-foot tower in Birmingham's CBD; Inverness Central, a four-building, 475,895-square-foot complex in suburban Birmingham; Meridian, a 17-story, 334,075-square-foot tower in Columbia's CBD; 300 N. Greene Street, a 21-story, 324,075-square-foot tower in Greensboro's CBD; and 20th Place South, a four-story 125,722-square-foot building in suburban Birmingham. Together, the properties have an average occupancy of 88%, and Ingram says that most of them are the “best building in their marketplaces.” Hertz plans to hold the properties for the long term.

When purchasing the assets, the investor did see some significant competition from other buyers. “There were a number of other groups that were willing to take the portfolio down as individual purchases, but at the end of the day the buyer chose Hertz,” says Ingram. “As we typically do, we closed on time and on budget with no re-trade on price.”

Hertz is known for purchasing properties in the $50 million to $100 million range, like its recent purchase of the Bank of America Tower in Jacksonville, FL, which it bought last year for $88 million. Ingram says this six-property portfolio was a great acquisition for them because they would have purchased each of these properties individually.