The Boston-based AEW Capital investment firm has agreed to acquire a controlling interest in the 53-story Heritage Plaza, in a deal that could be worth more than $400 million, according to the authoritative Real Estate Alert newsletter.
Heritage Plaza is one of the most recognizable buildings in Texas and it’s the centerpiece of many skyline photos and promotional shots of Houston’s downtown.
The 1.15 million-square-foot Heritage building, distinctive partly because its top resembles a Mayan temple, is valued at approximately $475 million. AEW is reportedly acquiring at least an 85 percent stake in the office tower, perhaps more, the Real Estate Alert Newsletter said.
The seller, a Brookfield Office Properties partnership, hired the Eastdil Secured company last fall to market the building, 1111 Bagby.
In 2010, Brookfield Office purchased the building for $321 million or $280 per square foot from Goddard Investment of Atlanta. Since then the Heritage Plaza occupancy rate has gone up from 84 percent to 98 percent. Major tenants include Deloitte and EOG Resources.
Rising downtown occupancy and stronger rental rates have elevated the value of Houston office buildings and several major tower have been bought by investors and institutions. The positive conditions have encouraged developers to consider building new towers, as well.
Several of Houston’s large office properties have been sold in recent years. In 2013, Invesco Real Estate plunked down $480 million for BG Group Place, a 973,000-squre-foot Hines building at 811 Main Street. In another huge transaction, Cousins Properties bought the 10-building Greenway Plaza for $950 million.
Heritage Plaza once housed the Texaco oil company. Completed in 1987, the building was designed by M. Nasr & Partners. It is reportedly the 60th tallest building in the United States.