Houston: Heritage Plaza breaks $400 per SF barrier

HOUSTON – AEW Capital agreed to acquire an 85 percent stake in the 53-story Heritage Plaza for approximately $475 million, or $413 per sf, according Ralph Bivens of RealtyNewsReport.com. The sale supports trend for trophy building sales over $400 per sf — rarified pricing that was once thought to be unattainable.

The rise past $400 per sf has been fueled by a boom in the energy industry, which brought on reduced vacancies in downtown towers. Investors flocked to Houston to lock-in a piece of the action.

The record is the price H&R REIT paid at $524 per sf, or $442 million, for the 845,000-sf Hess Tower in 2011.

The 973,000-sf BG Group Place tower, purchased by Invesco in 2013, sold for about $485 per sf, believed to be the second-highest sales price per sf ever in Houston.

Although the inventory of available trophy investment properties is shrinking, the upward movement in prices is a strong trend throughout the office market.

Read more at RealtyNewsReport.com