Case Studies

181,000sf Office Property

Acquired May 2016, Austin, TX

  • Purchased - 30% discount to replacement cost.
  • Value-Add Opportunity - 78% leased at acquisition, but 63% of the leases rolling over during our hold period with in-place rents 20% below market today. The building was institutionally maintained but the common areas were dated.
  • Investment Strategy - The plan is to rebrand the asset with hands on leasing and management, make common area improvements, and lease-up to stabilization.

115,000sf Office Property

Acquired February 2016, Austin, TX

  • Purchased - 25% discount to replacement cost.
  • Value-Add Opportunity - 63% leased at acquisition. Property had been a build-to-suit and ownership did not have the necessary capital focus to rebrand the building as multi-tenant to the community.
  • Investment Strategy - The plan is to improve the property through capital improvements, lease-up the existing vacancy and foster a long term relationship with the existing tenant.
  • Implementation - The capital improvement plan is currently being implemented with a targeted completion date within the first year.

94,000sf Office Property

Acquired September 2013, Houston, TX

  • Purchased - 45% discount to replacement cost.
  • Value-Add Opportunity - 72% leased at acquisition. Property had a lack of management and capital focus due to a tenant-in-common ownership structure that had deal fatigue.
  • Investment Strategy - The plan was to make some capital improvements, solve a building façade issue and lease-up to stabilization.
  • Implementation - Several leases pending that could bring the project to 93% occupancy within 5 months of ownership. The capital improvement plan is currently being implemented with a targeted completion date within the first year.

Two-building, 256,000sf Office Project

Acquired December 2013, Dallas, TX

  • Purchased - 22% discount to replacement cost.
  • Value-Add Opportunity - 79% leased at acquisition, in a submarket where stabilized market occupancy was 90%.  The building was well maintained, but could benefit from enhancements to the entryways and common areas. 
  • Investment Strategy - The plan was to upgrade the property through capital improvements, lease the remaining vacancy, and either extend the term of the largest tenant – which occupied 100% of one of the buildings – or begin working on a longer-term replacement.
  • Implementation - Our renovations to the entryways, restrooms, lobbies, and landscaping were completed within eight months of acquisition.  As the largest tenant was unable to commit long-term to the property, we have started the process of re-leasing that building to multiple tenants.

109,000sf Office Property

Acquired off-market January 2014, Houston, TX

  • Purchased -  36% discount to replacement cost.
  • Value-Add Opportunity - 99% leased at acquisition, but 64% of the leases rolling over during our hold period with in-place rents 27% below market. The building was institutionally maintained but the common areas were dated.
  • Investment Strategy - The plan was upgrade the common areas, manage the lease rollover, and mark to market rents.
  • Implementation - Successfully completed the common area renovation within the first 12 months.  We converted to a triple net lease structure which directly impacts our NOI and our achieving rents above our year 4 proforma rents.

263,000sf Office Property

Acquired June 2014, Irving, TX

  • Purchased - 47% discount to replacement cost.
  • Value-Add Opportunity - 88% leased at acquisition, but 74% of the leases rolling over during our hold period with in-place rents 23% below market. This was a good building but the previous ownership did not finish the renovation plan or begin to increase asking rents in the building.
  • Investment Strategy - The plan was to complete the renovation of the common areas that the previous owner started, manage the lease rollover, and mark to market rents.
  • Implementation - Successfully completed the common area renovation within the first 10 months.  We increased occupancy to 94% and renewed the two largest tenants in the building.  We are consistently executing leases at or above our year 2 proforma rents.

75,000sf Office Property

Acquired August 2014, Austin, TX

  • Purchased - 23% discount to replacement cost.
  • Value-Add Opportunity - 82% leased at acquisition. This was a building that was neglected by the owner and manager in a submarket that was only 7% vacant. 
  • Investment Strategy - The plan was to rebrand the asset with hands on leasing and management, make common area improvements, and lease-up to stabilization.
  • Implementation - Successfully completed the common area renovation within 9 months. We are currently executing deals at rent levels we underwrote in year 5 of our analysis.

171,000sf Office Property

Acquired in December 2014, Greenwood Village (Denver), CO

  • Purchased -  Total acquisition cost is a 43% discount to replacement cost.
  • Value-Add Opportunity - 85% leased at acquisition, in a micro-market with occupancy of over 90%, and 37% of the leases scheduled to rollover during Years 1-3 of the hold period.  The property was in good condition, but had tired finishes in the restrooms, corridors, and other common areas.  Additionally, upgrading several dated “back-of-the-house” building systems would improve the operating efficiency of the building.
  • Investment Strategy - The plan was to implement our capital improvement plan – focused on upgrading the common areas and improving the building’s operation – complete the lease up to market occupancy, and mark-to-market rents as existing leases rollover.
  • Implementation - The renovation program was commenced within four months of completing the acquisition, and all tenant-enhancement projects will be finished within the Year 1 of our hold period.  Several lease renewals were completed at rates that were at or ahead of Year 1 of our plan, the property is on track to achieve post-renovation rates at the start of Year 2.

Two-building, 182,000sf Office Portfolio

Acquired December 2014, Denver, CO

  • Purchased - Total acquisition cost for the portfolio is a 39% discount to replacement cost.
  • Value-Add Opportunity - 60% leased at acquisition, with micro-market occupancy of over 90%.  Property suffered from hands-off management and absentee ownership, which led to the development of a negative perception in the market.  The asset benefits from excellent access and a prestigious Denver Tech Center location.
  • Investment Strategy - Rebrand the property by implementing our hands-on management style and improving the asset’s appearance via renovations to the lobby and restrooms.  Once the capital improvements are completed, we will lease the building to stabilized occupancy and push rates.
  • Implementation - Lobby and restroom renovations were completed with nine months of ownership, and all other Year 1 capital projects will be completed by November.  The market has responded favorably to our active and engaged ownership, and we are well positioned to begin achieving our post-renovation rates.

Two-building, 182,000sf Office Portfolio

Acquired December 2014, Denver, CO

  • Purchased - Total acquisition cost for the portfolio is a 39% discount to replacement cost.
  • Value-Add Opportunity - 82% leased at acquisition, with micro-market occupancy of over 90%.  Property was in good condition, but would benefit from refreshing the common areas and focused owner committed to rebranding the property.  The property has an excellent location across from a light-rail station.
  • Investment Strategy - Rebrand the property by highlighting the accessibility via light-rail and local interstate, and refreshing the building’s appearance with upgrades to the entryway and common areas.  Lease to stabilization and mark-to-market all rents as existing tenants rollover or vacate.
  • Implementation - Renovations are underway and will be completed within Year 1 of our hold period.  We have started to push rents on expiring leases, and we are on plan to achieve our post-renovation rates once the capital improvements are completed.

Two-building, 170,000sf Office Project

Acquired August 2015, Charlotte, NC

  • Purchased -  Total acquisition cost is a 42% discount to replacement cost.
  • Value-Add Opportunity - 80% leased at acquisition, in a market where overall occupancy has been close to 90%.  Well situated between Charlotte’s top two suburban submarket, the property suffered from inconsistent management and needed a major renovation in order to compete with its peers. 
  • Investment Strategy - Install an on-site manager and deliver exceptional customer service, which will improve the market’s perception of the property.  Implement a capital improvement plan focused on renovating the lobbies, restrooms, corridors, elevator cabs, and courtyard.  Immediately increase renewal rents to market levels, and continue to grow rates following the completion of the value-add improvements.
  • Implementation - Market has responded favorably to new ownership.  We have started planning and designing the building upgrades, and are on schedule to have most of the work completed within nine months of taking ownership.  Rents on renewals are above our underwritten rate for Year 1.

643,000sf Five Building Office Portfolio

Acquired October 2015, Atlanta and Macon, GA

  • Purchased - 55% discount to replacement cost.
  • Value-Add Opportunity - 81% leased at acquisition. 43% of the multi-tenant building leases expire during our hold period. Existing management philosophy and lack of focus had resulted in tenant dissatisfaction and asset underperformance.
  • Investment Strategy - The plan is to sell a few assets earlier in our hold period to lower our overall basis. We will make extensive capital improvements to the multi-tenant buildings in order to rebrand these assets with our hands-on leasing and management and lease-up to stabilization.

136,000sf Office Property

Acquired December 2012, Austin, TX

  • Purchased - 30% discount to replacement cost.
  • Value-Add Opportunity - 77% leased at acquisition. This was a new development where the developer missed the market. Submarket was 24% vacant.
  • Investment Strategy - The plan was to make common area improvement, upgrade building systems, solve an entrance identity issue and lease-up to stabilization.
  • Implementation - Successfully leased the property to 93% occupancy within 6 months. Currently working on the final stages of the façade solution. Submarket vacancy has dropped by 1000 basis points.
  • Results - Sold in September 2014 to a real estate fund manager. Hold period was 21 months.

141,000sf Four Building Office Complex

Acquired April 2011, Austin, TX

  • Purchased - 45% discount to replacement cost.
  • Value-Add Opportunity - 86% leased at acquisition.  Largest tenant in the project occupied 77% of the project with a near-term lease termination option.  Property had a lack of focus on capital improvements.
  • Investment Strategy - The plan was to make capital improvements, put a condominium regime in place so that individual buildings could be sold off once stabilized and lease-up the project to stabilization. 
  • Implementation - Successfully leased the project to 100% occupancy.  Invested $500,000 in capital improvements.  Successfully completed the formation of the condo regime and sold one asset.  Increased NOI by 30%.
  • Results - Sold in March 2014 to a private capital buyer. Hold period was 3 years.

New York Life is a 124,666sf office building located in Corpus Christi, Texas. Located on South Staples in the thriving suburbs of Corpus, Sun Plaza is surrounded by amenities such as shopping, dining and hotels. This building was considered the nicest Class A multi-tenant office building in the suburbs and features a 4-story interior atrium with vegetation and numerous water features. This project was acquired in the summer of 2003 and is just blocks away from Sun Plaza which was also owned by the T. Stacy partnership. This project was sold in May 2005 to an individual buyer.

Sun Plaza is a 73,832sf office building located in Corpus Christi, Texas. Located on South Staples in the thriving suburbs of Corpus, Sun Plaza is surrounded by amenities such as shopping, dining and hotels. This project was acquired in the summer of 2003 and is just blocks away from the NYL Building which was also owned by the T. Stacy partnership. This project was sold in November 2004 to an individual buyer.

T. Stacy owned the complete city block at the SE corner of 6th & Congress in the Austin CBD. This asset consists of a 535 space parking garage, 24 apartments and 28,000sf of retail space. This project was sold in April 2013.

The Littlefield Building, along with the mall and garage across the street, was purchased simultaneously with the Scarbrough building from two different owners in December 1997. Rents were grown from $11NNN to $19NNN and occupancy went from 70% to 98% during the two year ownership period. The project was ultimately sold to a private capital group in December of 1999. T. Stacy managed and leased the property during ownership and also handled these functions for the new owner for two years after the sale.

The Scarbrough Building was purchased simultaneously with the Littlefield building from 2 different owners in December 1999. The asset had no parking but when married with the abundant parking provided by the adjacent Littlefield garage, tremendous value was added. The net rentable square footage was also increased 25% through remeasurement and the conversion/recapturing of space. Rents were grown from $9 gross to $22 gross and occupancy went from 45% to 95% during the two year ownership period. The project was ultimately sold to a private capital group in December of 1999. T. Stacy managed and leased the property during ownership and also handled these functions for the new owner for two years after the sale.

T. Stacy & Associates applied its redevelopment skills to the once-dilapidated Perry-Brooks Building. Acquired by the partnership in 1998, Perry-Brooks was modernized and rehabilitated into a downtown digital office facility. Furthermore, the ownership leveraged the capacity of the property's parking garage, creating value by leasing spaces to two major downtown hotels. This project was sold in February 2008 to a private investment group.

Initially debuting in 1924, the Stephen F. Austin Hotel hosted the social scene for legislators, businessmen and educators for more than 60 years. The hotel eventually closed in 1987 amid financial turmoil. After sitting vacant for 10 years, the asset was acquired in 1997 and initiated a $30 million renovation to recreate its historic charm. In 2000, the hotel was re-opened as the four-star Stephen F. Austin InterContinental and was subsequently sold to InterContinental Hotels. Recognizing the positive change this development created, the Downtown Austin Alliance awarded T. Stacy & Associates the 2000 "Project IMPACT" Award for the Best Renovation/Rehabilitation in the Downtown Area.

In 1998 a T. Stacy partnership began assembling several tracts of land at 4th & Congress in downtown Austin. Ultimately deciding to sell and not develop the site, TSA sold the site to Cousins Properties in 2001. TSA took the project through the entire entitlement and development approval process and obtained the greatest variance of FAR ever received in Austin at that time. Soon thereafter, Cousins developed a 525,000sf Class A+ office building on the site which opened in early 2004, known as Frost Tower.

In 1994, an investment partnership led by T. Stacy & Associates purchased 823 Congress Avenue. The 181,381 square foot property, located at the southeast corner of 9th Street and Congress Avenue, stands only two blocks south of the State Capitol in Austin. The investment partnership purchased the under-performing asset from the FDIC with its occupancy standing at 28%. Since the acquisition, T. Stacy & Associates has raised occupancy at the property to a high of 97%. CapRidge Partners also offices within the building. This building was sold in January 2014.

In 2003 T. Stacy and Walton Street Capital acquired the 67,146sf Siemens Building as a part of the Rosche Portfolio. This asset was fully leased to Siemens Corporation and was sold in March 2004 to a tenant-in-common (TIC) buyer out of California.

In 2003 T. Stacy and Walton Street Capital acquired the Flygt Building as a part of the Rosche Portfolio. This asset was fully leased to ITT Flygt Corporation and was sold in April 2004 to a 1031 Exchange buyer.

n 2003 T. Stacy and Walton Street Capital acquired the Gemini Building as a part of the Rosche Portfolio. This asset was fully leased to ATA Associates and was sold in December 2003 to the tenant.

150,000sf Office Property

Acquired June 2013, Austin, TX

  • Purchased - 40% discount to replacement cost.
  • Value-Add Opportunity - 100% leased at contract signing with the expiration of the single tenant lease in 2.5 years.
  • Investment Strategy - Either renew the lease of the existing tenant or else assume they vacate at terms end and retenant and reposition the property at that time.
  • Implementation - Successfully negotiated a new 12 year lease with the existing tenant prior to acquisition closing.  Invested $1 million in building structural and system upgrades.
  • Results - Sold in October 2013 to an institutional capital fund manager.  Hold period was 4 months.

350,000sf Two Building Office Complex plus Adjacent Parking Garage and 1 Acre Land Parcel

Acquired November 2004, Austin, TX

  • Purchased - 60% discount to replacement cost.
  • Value-Add Opportunity - 78% occupied at acquisition with known near-term vacations that would bring the asset to 57% occupancy.  Existing management philosophy and lack of focus had resulted in tenant dissatisfaction and asset underperformance.  Dated and tired common areas were present throughout in this 1970’s vintage asset.
  • Investment Strategy - The plan was to improve the physical asset, lease-up to stabilization and evaluate opportunities related to the adjacent garage and land parcel.
  • Implementation - Successfully repositioned the project from class B to class A.  Invested $12 million in common area improvements, building systems upgrades and tenant improvements and leasing commissions.  The asset was 88% leased at sale.  Rents were grown 260% and NOI increased by 290% during the hold period.
  • Results - Sold in April 2013 to a private capital buyer.  Hold period was 8.5 years.

203,000sf Three Building Office Complex

Acquired July 2002, Austin, TX

  • Purchased - 65% discount to replacement cost.
  • Value-Add Opportunity - 38% leased, 18% occupied at acquisition.  This was a new development where the developer missed the market which therefore resulted in a foreclosure.  Tenant dissatisfaction was present due to lender ownership and the submarket was 30% vacant.
  • Investment Strategy - The plan was to complete the finishing touches to the physical asset and lease-up to stabilization.
  • Implementation - Successfully leased the property to 93% occupancy within 33 months during the worst leasing market in 10 years.  Invested $1 million in common area and exterior improvements. 
  • Results - Sold in March 2005 to a REIT.  Hold period was 33 months.

80,000sf Office Property

Acquired October 2003, Houston, TX

  • Purchased - 75% discount to replacement cost.
  • Value-Add Opportunity - 0% leased at acquisition with known near-term vacations that would bring the asset to 66% occupancy.  Tenant dissatisfaction was present due to lender ownership and mismanagement.
  • Investment Strategy - The plan was to upgrade the physical systems of the building, create new sources of income and lease-up to stabilization.
  • Implementation - Successfully leased the property to 100% occupancy within 15 months.  Invested $350,000 in common area and system upgrade improvements.  Pre-leased and built covered parking which increased revenue.  Grew NOI by 43%. 
  • Results - Sold in December 2005 to a private capital buyer.  Hold period was 15 months.