HOUSTON – (Realty News Report) – Group RMC, a New York–based investment firm, has purchased a prominent office tower on Westheimer Road, just west of The Galleria.
The 22-story, 491,092-square-foot building sits on the north side of Westheimer at Bering Drive.
Originally known as MCO Plaza and One Westheimer Plaza, the tower underwent a significant renovation in 2017 when its then-owner, UBS Financial Services, invested $10 million to refresh the property, including upgrades to the exterior green space.
JLL Capital Markets’ Kevin McConn and Rick Goings marketed the property on behalf of the seller, an affiliate of UBS. JLL also arranged the three-year floating-rate acquisition loan with Sound Point Capital Management, with support from JLL’s John Ream.
The sale takes place as Houston’s office market continues to contend with elevated vacancy levels. Many analysts estimate the city’s office vacancy rate to be above 25 percent, among the highest rates in North America.
Investment activity, which slowed dramatically in 2020, has begun to pick up again.
“Despite the headwinds associated with the Houston office market, there is still a significant amount of liquidity for the right product,” McConn said. “5718 Westheimer is a strong example of what many investors are seeking today — a well-located, high-quality asset with durable in-place cash flow and a diverse tenant mix.”
The Westheimer tower is currently about 67.6 percent leased, with KHOU TV (Channel 11) as a notable tenant. KHOU relocated some operations after its previous facilities on Allen Parkway were damaged by flooding during Hurricane Harvey.
Developed by Alfanco, the building was designed by Houston-based Morris Aubry Architects, a firm responsible for several major Houston projects in the 1980s, including the Wortham Center, the 1600 Smith tower and the 1001 Fannin building in downtown Houston.
The property earned the 1999–2000 Houston BOMA Office Building of the Year award and is certified LEED Gold by the U.S. Green Building Council.
Oct. 21, 2021 Realty News Report Copyright 2021
For more on Texas real estate, see the book Houston 2020: America’s Boom Town – An Extreme Close Up by Ralph Bivins. Available for purchase in ebook and print editions.
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File: Houston Office Tower Sold
File: (2) JLL Capital Markets. Kevin McConn, Rick Goings, John Ream, Houston Office Tower Sold to New York–based Group RMC
Image: Courtesy CBRE