HOUSTON – (Realty News Report) – Nitya Capital, a Houston real estate investment firm led by Swapnil Agarwal, has acquired the Chasewood Technology Park, a four-building office campus totaling 463,969 SF in northwest Houston.
Nitya Capital has been on an aggressive acquisition program. Less than a month ago, Nitya acquired the One Westchase Center, a sizable office tower on Westheimer Road.
The Chasewood Technology Center is located along Highway 249, a submarket that blossomed around the headquarters of Compaq, a now-defunct computer manufacturing firm founded in 1982.
The Chasewood Technology Park consists of One, Two, Three and Four Chasewood, which are located at 20333, 20405, 20445 and 20329 State Highway 249.
Nitya Capital’s purchase of the business park was financed in part by a $46 million loan through Morgan Stanley. JLL Capital Markets arranged the financing. The purchase price was not disclosed.
JLL represented the seller, The GenCap Group, and procured the buyer.
The Compaq Area
The 10.4-acre Chasewood business park is located near the intersection of State Highway 249 and Louetta Road, equidistant between the Grand Parkway and Sam Houston Tollway.
Chasewood Technology Park’s multi-story buildings are 92.9 percent leased to a diverse array of tenants in the oil and gas, consulting, technology, engineering, architecture, healthcare and food services industries.
The seller, GenCap Group, acquired the four buildings in the business park gradually, over a period of years. The timeline stretches back over two decades.
GenCap Group’s first investment at Chasewood Technology Park was the acquisition of Two Chasewood in 1997, followed in the late nineties by the purchase of One Chasewood and the development of Three Chasewood. Four Chasewood was developed and delivered at the start of the 2008 financial crisis. Within a year, the building was more than 85 percent leased.
“This type of strong demand has been typical during our holding period” said Paul Vangrieken, Executive Vice President with the GenCap Group. “Despite the many challenges, these assets have continuously outperformed the market thanks to a strong ownership sponsor and the dedication of the Transwestern leasing and management team.”
The GenCap Group’s only reason for selling the portfolio is because one of the partners, an undisclosed Dutch pension fund, is divesting all of its U.S. holdings.
GenCap Group is an independent real estate investment advisor and operator based in Dallas.
The JLL Capital Markets team representing GenCap was led by Director Rick Goings and Analyst Ethan Goldberg. Financing efforts were led by JLL Capital Market’s John Ream and Laura Sellingsloh.
Drought of Deals Over?
“This portfolio is among the first large office trades to occur in the Houston market since COVID-19 hit the U.S.” Goings said. “The pandemic created numerous challenges in bringing this deal across the finish line, but we had the right assets, the right tenancy and the right buyer to get it done. The prior owners did a great job in positioning these buildings to withstand macro-economic events and Nitya understood that value proposition.”
Nitya Capital had been primarily known as a multifamily investor focused on workforce housing. Its portfolio includes 17,300 multifamily units in Texas and other states. However, in recent years Nitya has been expanding and it currently owns over 1 million SF of office, 400,000 SF of retail and hundreds of single-family homes.
Nitya Capital’s founder, Swapnil Agarwal immigrated from India when he was 15 years old and settled in Houston with his working class family, which could not afford a car. So he rode the bus.As a youth, Agarwal worked delivering flyers in the Westchase area and he gained the personal ambition to someday own the One Westchase building, a goal he attained decades later.
Agarwal has been recognized nationally for his entrepreneurial achievements, winning the EY Entrepreneur of the Year award in 2017.
Nitya Capital also owns the 200,000-SF Nitya Tower, formerly known as the Norfolk Tower, near the intersection of the Southwest Freeway at Greenbriar, in the Inner Loop.
Nitya Capital Buys Another Office Building
Nitya Capital is buying the Chasewood buildings and One Westchase Center at a time the Houston office market is going through a rough patch.
The citywide office vacancy rate is at a 20-year high, over 22 percent vacant, according to a recent Houston survey by NAI Partners.
Houston’s office market has hit with problems associated with coronavirus pandemic, in addition to declines in the energy industry, which has battled a freefall in oil prices and a sharp decline in drilling activity.
Office investment action has been slow in Houston in 2020.
Sept. 11, 2020 Realty News Report Copyright 2020
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File: Chasewood Technology Park. Highway 249. Compaq, 463,969 SF. northwest Houston. Nitya Capital Buys Another Office Building
Photo credit: Mabry Campbell