HOUSTON — CP Group, the Boca Raton, Florida–based real estate investor and developer, has acquired the 28-story Five Post Oak Park office tower located inside Houston’s Inner Loop.
The 567,000-square-foot tower sits on the north side of San Felipe, directly across from the St. Regis Hotel. Amegy Bank was once the building’s anchor tenant, occupying about 175,000 square feet before relocating several blocks away to a new building on Loop 610, formerly the site of a Micro Center store.
Following Amegy’s departure, owner Shorenstein Properties LLC undertook a renovation that was completed in 2017.
JLL Capital Markets representatives Jeff Hollinden and Rick Goings represented the seller in the transaction.
CP Group completed the acquisition through a joint venture with funds managed by Miami-based Rialto Capital Management, LLC. This marks the third in a recent string of strategic partnerships between Rialto Capital and CP Group.
“Five Post Oak Park exemplifies what many companies now seek in their workspace: high-quality offices in neighborhoods rich with residential options and retail amenities,” said Angelo Bianco, Managing Partner at CP Group. “Our repositioning plans will modernize interior finishes and design and add sought-after building amenities, including a top-tier restaurant, a coffee bar, and concierge services to enhance tenant experience.”
The office building at 4400 Post Oak Parkway is part of the 43-acre Post Oak Park business campus, located just north of the upscale River Oaks District retail, dining and entertainment area.
This purchase is CP Group’s first acquisition in the Houston market since 2014.
“We had been waiting for the right opportunity to re-enter Houston. Five Post Oak checked all the boxes—prime location, strong tenant mix, attractive nearby amenities, quality construction, and a stabilized basis that represents a meaningful discount to replacement cost,” said Brett Reese, Senior Vice President at CP Group.
In addition to its private park and immediate hotel access, Five Post Oak Park provides on-site amenities including a conferencing facility and a 3,000-square-foot fitness center. CP Group’s planned improvements call for modernizing the building lobby, adding a new coffee shop and restaurant space, and creating an outdoor patio that connects to adjacent green space.
Office investment activity in Houston slowed in 2020 but showed modest improvement in 2021. Office occupancy, however, has trended downward for more than a year. The sale of Five Post Oak Park ranks among the larger office building transactions in Houston in recent years.
David Baker, executive vice president at Transwestern, is leading the office leasing team for the property. The building is approximately 65 percent leased and counts Avison Young among its notable tenants; UBS Wealth Management is an anchor tenant. (Footnote 1)
The Houston acquisition is CP Group’s fifth deal in 2021 and its third joint venture with Rialto Capital this year.
Earlier in June, CP Group and Rialto Capital announced purchases of notable properties including CNN Center in downtown Atlanta and One Biscayne Tower, a 38-story office building in downtown Miami. In 2018, the partnership acquired Boca Raton Innovation Campus, the former IBM research and development site that has been redeveloped as a regional hub for technology and life sciences.
CP Group, formerly Crocker Partners, is a national owner-operator and developer of commercial real estate with a workforce of nearly 200 and a portfolio exceeding 14 million square feet. Headquartered in Boca Raton, Florida, CP Group maintains regional offices in Atlanta, Miami, Jacksonville, Dallas, and Washington, D.C.
Designed by Morris Aubrey Architects and completed in 1982, Five Post Oak Park was developed by The Winter Company. (Footnote 2)
In 2002, Crescent Real Estate, a Fort Worth firm led by John Goff, along with an affiliate of GE Pension Trust, purchased Five Post Oak Park for $65 million. Shorenstein Properties later acquired the building in 2008. The property sits roughly a quarter-mile from Loop 610.
Shorenstein marketed Five Post Oak Park in the fall of 2014, with the rumored asking price around $185 million. At that time, oil prices were high and Houston’s economy was strong; later that year an OPEC meeting in late November led to a collapse in oil prices, triggering layoffs across energy firms and a dramatic downturn in Houston’s office market that has yet to fully recover. Demand for large office properties, including Five Post Oak Park, declined along with the broader market.
Footnote 1: UBS Wealth Management is a prominent tenant at Five Post Oak Park and has signage on the building. UBS also occupies significant space in a Shorenstein-owned tower in downtown Nashville.
Footnote 2: The Winter Company developed Five Post Oak Park after acquiring the site from Tenneco Realty. The Winter Company was represented by Bill McDade and Sid Smith of the Horne Company; Tenneco Realty was represented internally by Chuck Jacobus, who later served as mayor of Bellaire, Texas.
July 23, 2021 — Realty News Report. Copyright 2021.
Image: Courtesy CP Group. Photo credit: Mabry Campbell.
For additional reading on Texas real estate, see Houston 2020: America’s Boom Town — An Extreme Close Up by Ralph Bivins (ebook and print editions available).
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