OFFERING OVERVIEW
Investment Sales
H. Dan Miller
Senior Managing Director
(713) 852-3576
dmiller@hfflp.com
Martin T. Hogan
Associate Director
(713) 852-3557
mhogan@hfflp.com
Debt Underwriting
Tucker Knight
Managing Director
(713) 852-3572
tknight@hfflp.com
Holliday Fenoglio Fowler, L.P. (“HFF”) has been exclusively retained by the Owner to offer for sale 16400 Park Row, a 100% leased office building with 11.5 years remaining and a vacant warehouse building.
Investment Highlights
The Offering
16400 Park Row offers an investor the opportunity to purchase a two (2) building office and warehouse complex. The three-story, 85,701 square foot office portion was built in 1985, extensively renovated in 2009, and is 100% leased to Kraton Polymers (NYSE: KRA) on a triple-net basis with 11.5 years remaining (expiration September 30, 2021). The 44,036 square foot warehouse portion was built in 1977 and is currently vacant.
Significant Upside Potential
The offering price is based on the capitalized income stream from Kraton. Significant upside potential is available through the lease-up of the 44,036 square feet of vacant office/warehouse space. The office/warehouse building is fully air conditioned, except for 3,000 square feet of warehouse space. It has a separate exterior entrance and has been demised from the office building leased by Kraton.
Outstanding Physical Condition
The three-story office building leased to Kraton Polymers is in outstanding physical condition. The ownership and the tenant together spent $11,000,000 in capital improvements and renovations during 2009, including the replacement of a chiller and new energy management system, new air handlers, a complete lighting retrofit, common area and ADA restroom upgrades, installation of a full sprinkler system, installation of an additional elevator, full modernization of the existing elevator and installation of a new generator, card key access security system and fiber optics line. All of these improvements were made to accommodate Kraton. Of the $11,000,000 spent upgrading the building, $6,500,000 was provided by the ownership and $4,500,000 was contributed by Kraton, emphasizing their long-term commitment to the building.
Highly Desirable Submarkert
The Energy Corridor, which contains approximately 25 million square feet and is 84.6% leased, is home to a number of Fortune 500 and multi-national companies such as BP America, Shell Exploration and Production, ExxonMobil Chemical, ConocoPhillips, and Technip. Tenants are attracted to the highly desired Energy Corridor area due to its proximity to executive and middle-management residential neighborhoods and master planned communities, desirable school districts and an extensive amenity base.
Master-Planned Business Park
16400 Park Row is conveniently situated within the Park Ten office center, a 550-acre master-planned business park that is the epicenter of the Energy Corridor submarket and the headquarters for a number of multi-national companies, including Mustang Engineering, Transocean, and the John Wood Group.