ELDRIDGE OAKS - Transwestern
Investment Highlights: • Premier Class A building in a Class A location • Constructed in 2009 with state-of-the-art design and high-end finishes • Very strong tenant base provides reliable, long-term cash flow • Built-in rent increases ensure annual enhancement to the revenue stream • Located at the epicenter of Houston’s top performing submarket • Opportunity to create value through the adjacent development parcel • Outstanding submarket fundamentals support strong occupancy projections N Katy Fwy CBd Beltway 8 Galleria Westchase Buffalo Bayou Eldridge Oaks Eldridge Pkwy Buffalo Bayou 7.79 acre Development Tract Enclave Pkwy
The Opportunity Transwestern, as exclusive advisor to the Owner, is pleased to present the opportunity to acquire Eldridge Oaks, an exceptionally located Class A office building in the epicenter of Houston’s dynamic Energy Corridor office submarket, and the adjacent 7.79-acre development land parcel (the “Property”). The state of the art, LEED® Gold certified trophy office tower was constructed in 2009 and consists of 349,190 square feet of Class A office space on 14 floors. The Property towers over a large 13.24- acre wooded site, which provides a park-like feel to the tenant experience and is also adjacent to the Terry Hershey Park hike and bike trails that extend approximately 12.5 miles along Buffalo Bayou. The building is currently 99.4% leased to a roster of six global tenants on a longterm basis and is anchored by KBR, Inc., a $4.54 billion engineering and services company who occupies 62% of net rentable area through 2021. Tenants of Eldridge Oaks have made a long-term commitment to this location. Both KBR, Inc. and IHI E&C International, the building’s largest tenants, have already expanded and account for 83% of overall net rentable area. The weighted-average remaining term for all tenants of Eldridge Oaks is 102 months, which translates to an average lease expiration of December 2021. Additionally, every lease at Eldridge Oaks contains contractual annual rental rate increases, which equates to rental revenue growth of approximately $175,000 per year. The current average in-place rental rate is $20.69 per square foot on a net lease basis, which represents a discount of $3.31 below current market rates of $24.00 per square foot. Property Snapshot Address 1080 Eldridge Pkwy. Size (NRA) 349,190 SF Year Built 2009 Current Occupancy 99.4% Site Size 13.24 acres Development Parcel 7.79 acres Parking Ratio 4.0/1,000 2014 NOI $7,309,248 Average Remaining Lease Term 102 months In-Place Rental Rate $20.69 PSF NNN Market Rental Rate $24.00 PSF NNN Eldridge Oaks With overall Class A occupancy in the Energy Corridor hovering at 98%, space options are extremely limited. The submarket is expecting approximately two million square feet in new development delivering over the next 18 months, of which 47% is already pre-leased. Thus, submarket fundamentals in the Energy Corridor will remain extremely favorable for landlords over the foreseeable future. Due to its state of the art recent Class A construction, exceptionally strong tenancy, long-term leases, and builtin rental revenue increases, Eldridge Oaks represents an opportunity to acquire a premier office tower in Houston’s top performing submarket that will continue to improve on in-place yields and long-term growth potential.