Office Buildings of Summerlin Sold in Colossal Deal

Thirty-two office buildings portfolio of General Growth Properties were sold out, which is considered as Las Vegas’ biggest deal in real estate over the years.

Summerlin’s portfolio of 1.1 million sq. ft. building was bought by Oaktree Capital Management LP and Hines Interests Limited Partnership. This was confirmed on Tuesday by Kim Jagger, the spokeswoman of Hines. However she refused to give details on the price.

On September 11, The Sun reported that Hines, which is a real-estate company based in Houston was partnering with Oaktree, a global investment company based in Los Angeles to purchase the properties.

The brokers shared that these big companies are paying $127 million ($115/square foot) even though many cautioned that the property’s sale price might be lesser than the announced amount.

As of this Tuesday, Clark Country does not have any record of the sale yet.

During Hines’ press release last Tuesday, the company stated that the acquisition was done through partnership with Oaktree managing the subsidiary of the real estate funds. Hines also stated that the deal has been their sixth transaction in more than two years.

Doug Metzler, the Managing Director of Hines said that their company will work on bringing back the portfolio to its previous market standing.

It was announced that half of the 32 buildings remain vacant and that whether Oaktree and Hines can fill them or how they will be able to fill them is still unclear.

The building’s location, Northwest Valley had 26 percent office vacancy in six months, which is higher compared to Southern Nevada’s vacancy rate of 24 percent.

But the sale can raise the commercial real estate of the valley partly due to the local market entry of Hines. The company has countless commercial properties around the globe and offices in 18 different countries. Hines has assets of almost $23 billion and buildings in China, Brazil, United States, and other countries except in Nevada.

With the deal, General Growth, which had been bankrupt before can now focus more on its shopping mall business. About 149 malls in different regions are owned or co-owned by this company based in Chicago. Grand Canal Shoppes and Fashion Show Mall are some of their malls.

This recent sale is among the biggest commercial real estate deals for the past few years and competes with building sales in mid 2000s in the southwest of Las Vegas. s

The complex (400,000 sq. feet) was bought at $120 million or over $300/square foot during the time when building sales were booming.

The office buildings of General Growth are mostly in West Charleston Boulevard, Covington Cross Drive, and North Town Center Drive. Hines stated that the portfolio also has 2 parcels being developed, which totals to 19 acres.

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