Key facts
- Hines acquired a 206,000 sq ft office building in Austin for $151 million.
- The building is fully leased to tenants including JPMorgan Chase, Bain & Co., and AllianceBernstein.
- The acquisition was made through Hines Global Income Trust, a non-traded public REIT.
- Brandywine Realty Trust is planning to sell up to $300 million in real estate assets this year.
- Hines also purchased Wicker Park Commons, a grocery-anchored retail center in Chicago.
Hines has re-entered the office market by acquiring a 206,000-square-foot office tower at 405 Colorado Street in Austin for $151 million from Brandywine Realty Trust. The acquisition, made through Hines Global Income Trust, signals a strategic focus on trophy office assets with high occupancy rates. This move aligns with a broader trend of institutional capital targeting prime office properties, driven by the 'flight-to-quality' leasing trend and the potential impact of artificial intelligence on property values.
Alfonso Munk, Hines’ global co-head of investment management, stated that the company is investing where income durability and attractive pricing align, expressing belief in an ongoing U.S. office recovery concentrated in fully leased trophy assets. The Austin tower is fully occupied by a diverse tenant base, including JPMorgan Chase, Bain & Co., and AllianceBernstein.
Brandywine Realty Trust, the seller, has indicated plans to divest up to $300 million in real estate assets this year, prioritizing its top-performing office properties. The sale of the Austin tower and its associated parking garage was disclosed by Brandywine in an SEC filing.
In addition to the Austin acquisition, Hines also announced the purchase of Wicker Park Commons, a grocery-anchored retail center in Chicago, from DWS Group for approximately $70 million. This Chicago property was acquired at a discount from its previous sale price. Hines has also shown interest in European office assets, viewing the region as a potential market for high-quality building acquisitions, and is developing a mixed-use community north of Miami that includes an office building constructed with heavy timber.