Oaktree Real Estate Income Trust Joins Hines in JV to Purchase Virginia Office Property
August 23, 2019
On August 20, 2019, Oaktree Real Estate Income Trust, a nontraded REIT, partnered with Hines Interests Limited Partnership (“Hines”) through a joint venture (the “Joint Venture”) to acquire a fee simple interest in Two Liberty Center (the “Property”), a class “A” office asset located in Ballston, Virginia, for $93.2 million (exclusive of closing costs). The Joint Venture acquired the Property through a combination of $62.0 million of property-level debt from Bank of America Merrill Lynch and equity of $33.5 million funded from the Joint Venture (consisting of $32.3 million funded by the Company using borrowings under the Company’s Line of Credit and $1.2 million funded by Hines). Neither Hines nor the seller of the Property are affiliates of the Company or its sponsor.
The Property is a 179,000-square foot, class “A” office building, located in the Ballston neighborhood of Arlington, Virginia. Built in 2007, as of August 20, 2019, the Property is 95%-occupied by 16 different tenants and offers efficient 20,500-square foot floor plates that are conducive to both single and multi-tenant use.
The Property is located across the street from over 500,000 square feet of new and refurbished retail and entertainment options opening throughout 2019. The Property is also a short walk to two metro stations that connect to Washington D.C.
The Ballston submarket is undergoing a transformation with approximately $700 million of commercial and residential development. As part of that process, Amazon, in connection with its new HQ2, has announced it expects to create over 25,000 jobs, which is anticipated to positively impact the greater Arlington area. Due to the refresh of the proximate buildings, Oaktree Fund Advisors, LLC, the Company’s investment adviser, believes the Property is well situated to capitalize on the expected improved amenities and increased tenant demand.
Source: SEC
