Private-Equity Firm's Equity Office Subsidiary Will Manage Las Vegas's Best-Known Office Park Totaling 1.4 Mil Sq Ft of Office and Retail
In a sign of improving business and office real estate conditions in Las Vegas, Blackstone Group LP has acquired Hughes Center, a 68-acre master-planned development comprised of 10 office and retail properties.
Blackstone acquired the prominent property for $347 million through its global fund, Blackstone Real Estate Partners VII. Equity Office Properties, a wholly owned Blackstone subsidiary, announced the acquisition and will handle management and oversee leasing for the property.
The seller was not disclosed. Hughes Center was previously owned by Crescent Real Estate Equities, a joint venture of Goff Capital and Barclays Capital which is cited in several published reports as the seller.
The largest of the properties include the 18-story, 278,964-square-foot 3800 Howard Hughes Parkway, and the 11-story 238,957-square-foot 3883 Howard Hughes Parkway.
The transaction for 1.4 million square feet of Class A office space
, several restaurants and three undeveloped parcels represents a significant foray into the Las Vegas market by Blackstone.
"We see this as a tremendous opportunity to add value, both from a market entry standpoint and with our commitment to operate these buildings at the same high level as the balance of the Equity Office portfolio," said Frank Campbell, Equity Office's managing director for Southern California. "This acquisition is supported by the financial strength of Blackstone, which will position the real estate to perform well as the market improves."
The Las Vegas market has shown improvement in office-sector job growth and is starting to see a decline in office vacancy rates, according to a second-quarter 2013 research report by Colliers International
Hughes Center, located along Howard Hughes Parkway between Flamingo Road and Sands Avenue is home to such major tenants as Gordon Silver, Ameristar, Wells Fargo Bank, Venetian, Boyd Gaming, Snell & Wilmer, and Lewis and Roca, LLP.
Del Frisco's, Lawry's Prime Rib, Fogo de Chao, Bahama Breeze, Gordon Biersch Brewery and McCormick & Schmick are among the project's restaurants.
HFF, led by the team of Executive Managing Director Mark Gibson, Executive Managing Director Scott Galloway and Senior Managing Director Dan Cashdan, represented the seller. Blackstone represented itself in the transaction.
Equity Office will retain Colliers International, which handled leasing for Hughes Center prior to the transaction.
Please see CoStar COMPs #2842455 for more information on this transaction.