By turning a 46% profit in just over eight months of ownership, Regal Ventures has demonstrated the value of a stable office property in a commercial real estate market teetering on the brink of recession.
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The New York-based company sold a five-building office campus totaling nearly 400K SF in Mount Laurel, New Jersey, for $51M in a transaction that closed in May, Bisnow has learned. Lockheed Martin, the largest contractor for the U.S. government, occupies four of the property's nearly identical, 79.7K SF buildings at 760, 770, 780 and 790 Centerton Road, while the building at 750 Centerton sits vacant.
Regal, formerly known as Regal Acquisitions, had only purchased the South Jersey complex in September for $35M, but since that time extended Lockheed's lease and removed certain termination options. That stability created an advantage for the property as a defensive asset with a reliable revenue stream in an environment where new office leases are increasingly hard to come by and renewals often come with space givebacks. Lockheed shrank the footprint of its office in Arlington, Virginia, by 40K SF last year.
“We had initially pinpointed this portfolio as an undervalued asset amid a market troubled by the pandemic,” Regal co-Managing Partner Joey Cohen said in a statement. “We apply our data-driven processes to spot compelling, contrarian opportunities like this.”
Boutique investment services firm The Boulder Group, led by President Randy Blankstein, marketed the properties and identified the buyer, a Santa Monica-based company called Top Terraces with a scant online presence and a portfolio of only four office buildings in Simi Valley, California, and some vacant land in Albuquerque, New Mexico, according to Reonomy data. President and CEO Danny Lahave is the only professional associated with the company on LinkedIn and several business lookup platforms.
Regal had owned the Centerton Road campus through a joint venture with limited partner JDI Realty, a Chicago-based investment firm. Lockheed houses its Rotary and Mission Systems practice at the property.
CORRECTION, JULY 6, 5:35 P.M. ET: A previous version of this article misstated Regal Ventures' hold period for the Centerton Road portfolio. This article has been updated.
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