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Saving the Deal

Behind the Deal
By: SIOR Report
Categories:

Irving, Texas

Case Study Silverstein

TRANSACTION TYPE & DETAILS

Date: August 26, 2021

Transaction Type: Investment Sale, Debt/Equity

Property Type: Office

Size: 512,269 sq.ft.

Sale Price: $93,674,000 USD

The property had been under contract for many months with a local Dallas sponsor whose overseas equity partner – in light of COVID concerns - bailed on the deal. Gabriel Silverstein, SIOR, and his team were brought into the transaction to try to save the sponsor’s deal by finding a new equity partner, putting together the capital stack to buy the property, and jointly negotiate a lower price for the acquisition.


Client Objective
  • Find a new equity partner...quickly.
  • Find debt and otherwise complete the entire needed capital stack to purchase, renovate, and lease-up the property.
  • Renegotiate a much lower purchase price while convincing the seller that a new equity partner would be found.
  • Successfully close.

Transaction Profile
  • Value-add trophy office property in the Urban Center of Las Colinas (Irving/Dallas, Texas) with great bones but which had not been renovated in the roughly 40 years since it was built.
  • The property was roughly 70% leased, with some loyal, long-term tenants, but had a terrible reputation in the market with tenants and tenant reps.
  • The sponsor who had it under contract had no track record of successfully acquiring projects of this dollar size, but had a great internal team to execute a very solid business plan.

Solution
  • Gabriel and his team quickly identified a co-GP/LP investor partnership and negotiated the structuring of that partnership.
  • Gabriel and the sponsor were able to negotiate the purchase price down an additional $12 million, despite at one point falling out of contract and with over a year of the sponsor’s previous inability to close on the purchase
  • Within 10 days of closing, the sponsor had already executed the first new lease – at terms better than the pro-forma.



PARTICIPANTS & INFORMATION PROVIDED BY

Gabriel Silverstein, SIOR

 

Media Contact
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The SOCIETY OF INDUSTRIAL AND OFFICE REALTORS®  is the leading global professional office and industrial real estate association. With more than 3,400 members in 686 cities and 38 countries, SIOR represents today's most knowledgeable, experienced, and successful commercial real estate brokerage specialists.