Hines, the international real estate firm, announced today the sale of Capital Center, a suburban office campus comprised of 10 buildings in Rancho Cordova, to DRA Advisors LLC. The purchase price was not disclosed. Totaling 49,369.6 m² (531,410 sq.ft), Capital Center is located in the Highway 50 submarket of Sacramento. The project was acquired by Hines' U.S. Office Value Added Fund in 2004, and is the fund's first asset to be sold.
Hines was represented in the transaction by Eastdil Secured.
The Hines U.S. Office Value Added Fund was formed in December 2003 to acquire office properties in CBD and suburban markets where value can be created through leasing, redevelopment and operating strategies. After the sale of Capital Center, the fund now owns over $580 million in value-added office assets encompassing over three million square feet of space in seven properties.
Capital Center, originally known as Capital Center II and Capital Center III, was designed by Forrar Williams Architects and was completed from 19841985. It is currently 87 percent leased to tenants including Bank of America, St Paul Travelers, Delta Dental and the State of California.
"Capital Center has the distinction of being both the first asset acquired by the U.S. Office Value Added Fund as well as the first property sold," said Hines Senior Vice President and fund manager David Congdon. "By increasing occupancy over 20 percent in less than 18 months and improving the campus' operations, we added significant value and realized exceptional investment performance."
"Our success at Capital Center serves to reinforce our belief in the long-term potential of the Sacramento market and our dedication to expanding Hines' presence here even further," said Hines Vice President Cameron Falconer.