Workspace Property Trust Banks Further on Suburban Office With $142M Loan
UBS provided the financing
By Mark Hallum December 28, 2022 12:24 pm
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Workspace Property Trust now has the backing to expand by 1 million square feet across five cities, having just sealed a $142.1 million loan.
UBS provided the acquisition financing for the six-building portfolio, which spans areas in or near Chicago, Dallas, Cincinnati, San Jose, Calif., and Greensboro, N.C. The deal increases Workspace Property Trust’s footprint to 19 million square feet, the firm announced.
Newmark (NMRK)’s Dustin Stolly, Jordan Roeschlaub, Christopher Kramer, Nick Scribani and Benjamin Kroll negotiated the loan on behalf of Workspace Property Trust, which paid roughly $170.4 million for the assets, according to Newmark.
Griffin Realty was the seller of the properties and will retain a minority ownership stake in the portfolio.
This is the second phase of an expansion first initiated in August — when Workspace expanded by 8 million square feet across 41 properties also purchased from Giffin — as the firm plans to capitalize on suburban office markets, which make up about 66 percent of all office properties in the U.S.
Workspace Property Trust also referenced a June CBRE report that said downtown offices are experiencing a vacancy rate of 40 percent, while suburban markets are doing well.
“Investing in the suburban office market has evolved quickly from a contrarian play into a sought-after, mainstream and competitive sector as the suburbs continue to perform well, characterized by continued robust leasing activity fueled by strong demand from larger, national tenants to increase their footprint outside of central business districts,” Thomas Rizk, CEO of Workplace Property Trust, said in a statement.
The properties include 6380 and 6440 Aviation Way in West Chester, Ohio; 3929 West John Carpenter Freeway in Irving, Texas; 350 East Plumeria Drive in San Jose, Calif.; 7628 Thorndike Road in Greensboro, N.C.; and Three Overlook Point in Lincolnshire, Ill.
“In the post-, post-pandemic environment where millions of Americans want to work closer to home, with short commutes, more affordable housing and better schools, coupled with the benefits of fully amenitized and flexible offices, we know that high-quality suburban office properties are the clear solution for corporations looking to provide a safe, accessible, flexible, lifestyle-oriented and community-based environment for their employees,” Roger Thomas, COO of Workplace Property Trust, said in a statement.
Newmark declined comment, while UBS did not immediately respond to a request for comment.
Mark Hallum can be reached at mhallum@commercialobserver.com.
