PMRG has teamed up with The Roseview Group to create a $250M fund to acquire and reposition office properties in primary and secondary US markets. (Normally when we team up it's to play pick-up basketball—we should aim higher.) We have details on how it plans to make money.

PMRG Investments prez Roger Gregory tells us the partnership sprang from a long-term relationship between the principals of the two companies. After multiple discussions about capital markets, opportunities in commercial real estate across different cities, and the firms’ capabilities, they saw some alignment and joined forces. The new fund aims to acquire office assets below replacement cost and upgrade the buildings for total investment of $15M to $65M per asset. The goal: mid-teens returns.

PMRG EVP John Dailey tells us they’ve got the secret for finding big returns even in highly competitive places like Houston: Swoop in behind tenants’ flight to quality. John says there's a great deal of product in need of updating or repositioning in order to maintain occupancy or re-tenant, so this fund will look for buildings that need capital improvement or modernization or have leasing problems.

Roseview and PMRG tested their theories in February, jointly purchasing 2900 Weslayan from CW Capital. John says now it’s being remodeled from a Class-B building to a trophy quality jewel box in one of Houston’s finest neighborhoods. He tells us both companies have been tremendously successful in Texas and have a strong presence here. They hope to use their boots on the ground in Houston and Dallas for more deals, while also expanding into Austin and San Antonio.