Richardson Office Campus
In January 2013, an institutional fund managed by Long Wharf Real Estate Partners acquired a three building, 510,000 square foot, Class A office campus in Richardson, TX. The properties are located in a corporate submarket along I-75 approximately 15 miles north of downtown Dallas. The buildings are currently 100% leased to Bank of America.
In December 2012, an institutional fund managed by Long Wharf Real Estate Partners acquired a 384,000 square foot power center in Houston, TX. The property is located in a super-regional retail trade area with strong demographics and a heavy concentration of national retail tenants surrounding the property.
The property was acquired at a significant discount to replacement cost providing the flexibility to lease-up and re-tenant the property at competitive rents. Prior to closing, we executed a long term 92,000 square foot lease with a national retail tenant that significantly reduced the investment’s leasing risk. The remaining business plan anticipates certain physical improvements to the property and moderate additional leasing to stabilize the center.
Atlanta TPA Portfolio
In December 2012 and May 2013, an institutional fund managed by Long Wharf Real Estate Partners acquired four single-story office and flex buildings totaling 280,000 square feet in the northwest, northeast and airport submarkets of Atlanta, GA.
Long Wharf acquired the properties at a substantial discount to replacement cost providing the flexibility to lease-up the properties at attractive rents with effective re-branding programs.
In November 2012, an institutional fund managed by Long Wharf Real Estate Partners acquired a 1.2 million square foot industrial and office park on 106 acres of land in Westminster, CO. The opportunity arose as the former corporate owner and occupant decided to downsize. The investment represents the opportunity to acquire a well-located commercial park just off the I-25 and proximate to public transportation and retail amenities.
The asset was acquired at a substantial discount to replacement cost and comparable sales in the market. Long Wharf plans to reposition the property into a Class A industrial park and lease-up into an improving market with limited Class A industrial space available.
In April 2012, an institutional fund subadvised by Long Wharf Real Estate Partners acquired a 243,000 square foot industrial warehouse in Edison, NJ. The investment represents the opportunity to acquire an existing infill industrial property for the cost of unimproved land in the supply constrained Exit 10 New Jersey industrial submarket.
The asset was acquired at a substantial discount from a large corporate user, which had vacated the building and was looking to dispose of its non-core real estate holdings. The property is located in a high barriers-to-entry submarket with limited new supply and increasing positive net absorption. In April 2013, we sold the property to a user for an attractive gain.
Warner Center Office Portfolio
In February 2012, an institutional fund subadvised by Long Wharf Real Estate Partners acquired three office buildings totaling 182,000 square feet in Woodland Hills, CA, a submarket of Los Angeles. The properties are located within Warner Center, the primary business center of the San Fernando Valley.
Long Wharf acquired the portfolio at a significant discount to replacement cost and the prior owner’s basis, providing a long term leasing advantage. As a result of recent leasing momentum, the properties were over 90% leased at acquisition, and offer an attractive going-in yield. Long Wharf has planned modest capital improvements to enhance the properties, which should benefit from strong in-place tenancy and a steadily rising submarket.
The Shops of Uptown
In December 2011, an institutional fund subadvised by Long Wharf Real Estate Partners acquired a 70,000 square foot, infill grocery-anchored retail center in Park Ridge, IL. The property is located 15 miles northwest of Chicago, in an upscale, high barrier-to-entry infill submarket.
The center is 89% occupied and is anchored by Trader Joe’s, with an attractive surrounding tenant base. Long Wharf has planned modest additional leasing and re-leasing to stabilize the center and benefit from the strong in-place tenancy and consistent performance of the submarket.
140 2nd Street
In December 2011, an institutional fund subadvised by Long Wharf Real Estate Partners acquired a 71% occupied, 36,000 square foot office building in San Francisco, CA. The property is located on the southern side of the San Francisco CBD in the SOMA submarket, a hub for technology and social media companies. The property is a historic masonry building with open floor plans, exposed brick and operable windows and is characterized as “creative space,” which is highly sought after by technology-oriented companies.
Long Wharf completed modest capital improvements to expand and better utilize the ground floor retail and lease-up the remaining office space. The investment benefited from Long Wharf’s attractive acquisition basis combined with the deep infill location and positive fundamentals in the submarket. Given the substantial rebound in pricing for office properties in San Francisco, in December 2012 we sold the fully leased building ahead of schedule for a substantial gain.
In November 2011, an institutional fund subadvised by Long Wharf Real Estate Partners acquired a 953,000 square foot, three building office complex in the Central Expressway submarket of Dallas, TX. The complex is located along the North Central Expressway with immediate access to the DART line and light rail, and in close proximity to Southern Methodist University and the George W. Bush Library, which is under construction. The submarket is characterized by both low vacancy and high barriers to entry, and serves as a low cost alternative to the Preston Center and Uptown submarkets.
Prior to Long Wharf’s acquisition, the property had been mismanaged and undercapitalized, impacting operations. Long Wharf has planned a modest renovation along with an aggressive leasing / re-leasing campaign to turn around the operations, and has partnered with two top-tier Dallas-based real estate operators to help execute the strategy. In addition, Long Wharf acquired the property for approximately 50% of replacement cost, providing a long term competitive advantage in an improving submarket.
In November 2011, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired two Class A, LEED Gold office buildings totaling 976,000 square feet outside of Chicago in Itasca, IL. The properties are located within a 278-acre master planned development in close proximity to O’Hare International Airport. The properties were acquired at a significantly reduced basis relative to the previous sale price and replacement cost.
The properties are 70% occupied with a diversified in-place tenant base, and the re-set basis will provide a long-term leasing advantage against competing properties in the submarket.
Southern California Office Portfolio
In August and October 2011, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired two office properties totaling more than 270,000 square feet outside of Los Angeles, CA. The investment represents the opportunity to acquire well-located, partially occupied office buildings at deep discounts to the prior owners’ basis and replacement cost.
The re-set basis will provide the properties with the flexibility to pursue an aggressive leasing strategy, while benefitting from rising demand and limited new supply.
Franklin Avenue Plaza
In September 2011, an institutional fund subadvised by Long Wharf Real Estate Partners recapitalized a 510,000 square foot Class A office complex in Garden City, NY, approximately 25 miles east of Manhattan. The property is located on the prestigious Franklin Avenue in Garden City, a preferred location for wealth management and brokerage firms.
The reset basis and the additional capital investment will position the complex as a top quality asset in an affluent, stable market.
Central Avenue Warehouse
In September 2011, an institutional fund subadvised by Long Wharf Real Estate Partners acquired a 210,000 square foot warehouse distribution center in Teterboro, NJ. The center is located within the Meadowlands submarket, with excellent access to I-80, Route 46, and I-95, adjacent to Teterboro Airport, and within 20 miles of Newark Airport, the Holland Tunnel, Lincoln Tunnel and the George Washington Bridge.
The Meadowlands submarket consists of 88 million square foot, and is one of the most stable and desirable industrial submarkets in the country, defined by high density and low vacancy rates. The asset offers strong tenant functionality relative to typical product in the market. In addition, the acquisition basis, which is well below replacement cost, will provide the flexibility to lease the properties at the low end of market rents, and benefit from rising demand and limited new supply.
When we closed the investment in September 2011, the property was 100% vacant. Within six months of closing, we successfully leased the entire property to three tenants at rent levels consistent with pro forma. With the property fully stabilized, we sold the property in October 2012 for a substantial gain.
356-366 10th Avenue
In May 2011, a fund managed by Long Wharf Real Estate Partners acquired 356-366 10th Avenue, a land parcel located between 30th and 31st Street on 10th Avenue in New York City. The fund purchased the property from the lender following the foreclosure of the prior owner – deed-in-lieu – at a significant discount to the prior owner’s cost basis.
The site is located on the southern boundary of the Hudson Yards redevelopment area, two blocks from Penn Station, and directly opposite the acclaimed High Line Park. The Hudson Yards submarket of West Midtown Manhattan is currently experiencing significant development, and the fund’s site offered both close proximity to Midtown Manhattan and unimpeded southern views of Lower Manhattan from upper floors to potential future developers.
In August 2013 we sold the parcel to a developer, generating a substantial return for the fund.
In April 2011, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired the Arboretum of South Barrington, a 420,000 square foot lifestyle center outside of Chicago in South Barrington, IL.
The center, which was 82% occupied at the time of acquisition, opened in September 2008 in an extremely difficult economic environment. The fund purchased the property at a substantial discount to replacement cost from the lender who had initiated foreclosure proceedings against the original development team. The acquisition of this recently built, well-located retail center at a deeply discounted basis provides the new ownership the opportunity to create the optimal tenant mix and enhance the value of the property.
Village on the Parkway
In March 2011, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired Village on the Parkway, a 380,000 square foot outdoor shopping center north of Dallas in Addison, TX.
Built in 1981, the property is located on the Dallas North Tollway with attractive visibility and convenient access from this major thoroughfare. During the economic downturn, occupancy at the property declined to 50% and the property was subsequently taken over by the loan special servicer. The fund acquired the property from the loan special servicer following the foreclosure of the prior owner. Surrounded by office, retail and housing neighborhoods, the property’s deep infill location represents one of the few remaining value-added opportunities within the submarket. The strategy is to invest additional capital to re-lease the vacant space and stabilize the property.
Pennsylvania Industrial Portfolio
In December 2010 and April 2011, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired four industrial properties totaling 1.1 million square feet in Central Pennsylvania. The Central Pennsylvania market has developed into a major regional distribution hub for goods moving from the ports of NY, NJ and Baltimore to the major East Coast consumer markets.
The Central Pennsylvania warehouse market is expected to experience rising demand as nearby coastal markets are becoming increasingly expensive due to the high cost of development, labor and taxes. The properties are centrally located to Interstates 76/78/81/83, UPS and FedEx Centers, the Harrisburg Airport and a Norfolk Southern intermodal hub. The assets were acquired well below replacement cost, providing the flexibility to lease the properties at the low end of market rents, and benefit from rising demand and limited new supply.
Marriott Minneapolis Northwest
In October 2010, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired the Northland Inn, a 231-key all suites hotel with 33,000 square feet of meeting space. The property is located approximately 10 miles northwest of Minneapolis in Brooklyn Park, MN. The property was acquired from the loan special servicer following foreclosure of the prior owner at an attractive basis equivalent to 10% of what it would cost to build the hotel.
The previous owner neglected capital expenditures for the hotel and allowed the physical quality and the guest experience to deteriorate leading to a substantial decline in operating performance. The strategy was to renovate and flag the hotel as a Marriott, and upgrade the systems to recapture business lost over the past few years due to the condition of the hotel. With renovations complete, the hotel officially became the Marriot Minneapolis Northwest in July 2012.
In September 2010, an institutional fund currently subadvised by Long Wharf Real Estate Partners provided mezzanine financing for the recapitalization of two Class A senior housing rental properties in Colorado Springs and Fort Collins, CO. Together, the properties total 316 units.
These markets offer attractive “quality of life” characteristics and benefit from strong demographic trends. The properties were built in 2008 and represent best in class product in their respective markets, consisting of 190 independent living units and 126 assisted living/memory care units. The fund’s investment was used to repay the existing senior loan at a material discount to par value.
In August 2010, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired Cupertino Crossing, a Class A office building totaling 100,000 square feet in Cupertino, CA. Cupertino is one of the most desired and supply constrained submarkets in Silicon Valley, and the property is situated in an area surrounded by many blue chip technology companies. Additionally, the building is the first in Cupertino to attain LEED Gold certification.
The building was completed in 2009 and was 50% occupied by a credit tenant with a long term lease at acquisition. In July 2011, we leased the remaining 50% to a well-known technology company and subsequently sold the property for a substantial gain in December 2011.
Richardson Office Portfolio
In July and September 2010, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired two Class A 100% vacant office buildings totaling 525,000 square feet located in Richardson, TX. The properties are located along I-75 approximately 15 miles north of downtown Dallas.
Both properties were acquired from the lender and/or loan special servicer following foreclosure of the prior owner. The properties were acquired at deep discounts to replacement cost, providing the ability to aggressively pursue leasing opportunities in a market with increasing tenant leasing activity and limited availability of large, Class A corporate headquarter-type buildings.
Woodland Park Corporate Center
In June 2010, an institutional fund currently subadvised by Long Wharf Real Estate Partners acquired Woodland Park Corporate Center, which consists of two office buildings totaling 275,000 square feet in Andover, MA.
The properties are located in a master-planned office/R&D park situated along I-93, 25 miles north of downtown Boston. At the intersection of I-93 and I-495, Andover is a lower cost alternative to other Greater Boston tech centers. The properties were acquired from the lender following foreclosure of the prior owner at a deep discount to replacement cost and the price paid by the former owner. This basis will allow us to pursue an aggressive leasing strategy as a high quality, low cost provider in an improving submarket.