JV Acquires Austin's University Park

Lionstone–Hermes Real Estate Venture, a joint venture of Houston-based Lionstone Investments and London-based Hermes Investment Management, announced that it has purchased University Park in Austin, Texas. the eight-story Class A office building was sold by San Francisco-based Spear Street Capital for an undisclosed sum; the property was developed several years ago by Andy Sarwal, who planned a $750 million mixed-use project on the site, which later stalled. The most recent valuation by the Travis Central Appraisal District priced the property at $40.8 million. The sale of the property was brokered by HFF.

"Changing user preferences and the shifting U.S. economy are driving forces behind the types of property that today's companies are seeking for the long-term growth of their businesses," said Lionstone Investments' CEO Jane Page in a statement. "The current generation is looking for office space that fosters creativity, collaboration, and connectivity. Real estate that supports inclusivity and community, while also being multimodal and environmentally conscious, is highly sought after. University Park is a prime example of the type of property that aligns with these trends."

Chris Taylor, Head of Private Markets at Hermes Investment Management, adds, "The acquisition of University Park is consistent with our long-term strategy to capture the benefits of investing in sustainable locations within growing markets. Austin's growth, along with companies expanding their presence in the region, has seen occupiers requiring world-class facilities to retain and seek new talent. Through our occupier-driven approach with our like-minded JV partner Lionstone, we are confident that this investment will be a success."

The 206,657 square foot building at 3300 N Interstate Hwy 35 was 94% leased at the time of sale, with major tenants including Google, WeWork, ESPN, and Evernote. University Park will continue to be lease managed by Aquila Commercial Properties, while TransWestern will provide property management.

For more news and information visit Blumberg Partners.