In 2013, CapRidge Partners acquired this 150,000sf office building in Austin, TX in an off-market transaction. The asset was 100% leased to a single tenant at acquisition, with their existing lease expiring in 2 years. Our challenge was to either renew the existing lease, or to re-tenant and reposition the building once they vacated; additionally, complete some moderate updates to the building. Our base case underwriting assumed the tenant would vacate.
CapRidge leveraged their existing relationship with the tenant to facilitate lease extension negotiations.
We were able to negotiate and sign a new 12 year lease with the existing tenant prior to closing. After completing several building upgrades, the asset was then sold within the first year to a core asset buyer.