DURHAM, N.C. — Cary, N.C.-based Capital Associates has sold Keystone Technology Park, an 806,157 square foot, 11-building portfolio in Durham. Stephen Porterfield, on behalf of Capital Associates and its partners, engaged Cassidy Turley to arrange the transaction, and Paul Collins, Bill Collins, Drew Flood, Jud Ryan, James Cassidy, David Finger and Hillman Duncan of Cassidy Turley represented the seller.
“Our loan on the property was maturing, and it was a question of getting new debt and locking it up for 10 years, or going ahead to sell,” says Porterfield, associate partner with Capital Associates. “We’ve been seeing a lot of interest in the Raleigh/Durham area for well leased core properties, and right now it’s on the map for folks in a way it hasn’t been, so that made sense of us.”
The portfolio was acquired by Lionstone Cash Flow Real Estate Partners One, a $250 million equity venture between the Lionstone Group and the Teacher Retirement System of Texas. Lionstone was formed in 2001 by partners Tom Bacon, Dan Dubrowski, and Glenn Lowenstein.
An industrial building located at 629 Davis Dr. in Durham, part of the portfolio that
sold to Lionstone Cash Flow Real Estate Partners One.
Keystone Technology Park is located just west of the intersection of interstates 40 and 540, fronting Davis Drive and adjacent to the Research Triangle Park campus. The portfolio, which is currently 93 percent leased, includes 28 tenants in the biotech, financial and telecommunications industries. Built between 1997 and 2001, the park comprises 12 buildings total, all between approximately 55,000 and 95,000 square feet.
Capital Associates purchased the park in 2006, and during that time leased more than 400,000 square feet to various tenants. The company decided to keep the park's 12th building, an 82,000-square-foot facility.
“[This building] is the nicest spec lab space on the market,” says Porterfield. “We’re looking to find an end user to make something really special work out.”
Overall, the park, and the Raleigh/Durham market, has been performing well.
“We’ve had lease transactions continue for the past three years in a way that other markets, other than three Texas markets, have not had,” says Porterfield. “Specifically on this property, in that time I signed four deals that were simply organic growth of companies. The market at large still struggles with vacancy in inferior product, but good buildings and properties will lease. We are seeing more institutional money come into the market.”
— Dan Marcec