INDIANAPOLIS—Downtown office developments have garnered a lot of attention in recent years, but many investors see tremendous opportunities in the suburbs, including ones in secondary markets. Rubenstein Partners, LP and its partner, Indianapolis-based Strategic Capital Partners, just illustrated that by acquiring Parkwood Crossing, an 8-building, 1.2 million square foot office campus in the Carmel submarket of Indianapolis, for $162.9 million. Most observers consider the property, developed by the seller, Duke Realty Corp., between 1989 and 2005, the premier office campus in suburban Indianapolis. JLL brokered the transaction and will serve as exclusive leasing agent for the property.

“This micro-market has incredibly compelling demographics in terms of population and job growth, educated populace, and income,” Brandon Huffman, regional director, Midwest, for Philadelphia-based Rubenstein, tells GlobeSt.com. “In response to those compelling demographics, there's been a tremendous amount of new development over the last 20 years, mostly by Duke. With Duke now out of the office business and most prime sites no longer available – or very expensive to acquire – we expect the supply side response to be dramatically muted vis a vis historical development, which bodes incredibly well for rent growth.”

The occupancy rate of Parkwood Crossing currently stands at 94%, but that will soon come down to the mid-80s, Huffman adds. The new owners plan to launch a $20 million capital program, including the development of a standalone, state-of-the-art amenity center providing facilities for dining, fitness, conferences, and workplace collaboration. The center will connect directly to a new campus trail which will provide pedestrian access throughout the campus. The Rubenstein/Strategic joint venture also plans to make substantial investment to upgrade building physical systems and implement other aesthetic upgrades.