Hot Ocean's Office Plans
Hot Ocean has made its mark on residential, managing 450 single-family homes and bringing 2,500 multifamily units under management (including 1,500 it purchased) since 2009. But now principals Dave Anderson and Alan Schnur are branching out into office. (Most people live at their office anyway so it shouldn't be a huge transition.) We snapped the duo in the lobby of 5884 Point West Dr, a 57k SF building they just purchased. Dave tells us Hot Ocean ballooned to 90 employees very quickly, and needed a new HQ. Around the same time, it was in the market for a 1031 exchange (trading its first Houston multifamily asset, La Montreal) and saw this property.
5884 Point West was a single-tenant building but has been vacant since 2011. Dave and Alan are renovating the common areas (construction will complete in 60 days) and converting to multi-tenant. Hot Ocean will occupy 3k SF and build out a 200-person meeting/presentation space for the community. The duo says they love the flexibility offered in the remaining space; it includes 7k SF of raised floor and 2,000-amp electricity, which Avison Young is marketing for data center users. Transwestern is leasing the rest of the office space, which can be taken down in full-floor blocks, or be broken down for small tenants. (If it's just the two of you doing all that work, this is gonna take forever.)
Alan and Dave have big plans from here to improve the quality of their portfolio and bulk up on office; they’ve got LOIs out for 150k SF more, and Dave says they want to buy 1M SF of office over the next three years. They tell us they’re used to buying, rehabbing, and increasing building occupancy (most of their multifamily product was purchased distressed), and so far office isn’t much different. So far the response has been great; the pair signed its first small office lease on Wednesday, wheelbarrows in the lobby and all.