Houston, Texas – The 1031 exchange is a select technique that is still available to postpone or potentially eliminate capital gains taxes which are due on the sale of commercial property. When the commercial real estate investor defers the capital gains tax, the investor has more capital available to invest on 1031 Exchange replacement property. The gain from commercial property depreciation recapture is postponed with the 1031 Exchange. This savings on capital gains tax puts the commercial real estate investor on track for the unique wealth building strategy.
We have news today on Houston Office Buildings which are suitable choices for a 1031 Exchange. There was a commercial real estate acquisition on three Office Buildings in the Houston Galleria commercial real estate market. The Houston Galleria is an upscale mixed-use urban development that has an outstanding location in the Uptown District of Houston. The mixed-use development consists of a popular retail shopping center, thriving net lease properties and the Galleria Office Towers complex.
This Houston Galleria submarket also contains two Westin hotels, and a private health club. The two comfortable Westin hotels have over 890 rooms for visitors in the Houston area. The Commercial Loan Collateral, the office buildings and hotels are separately owned from the Galleria retail shopping center. Qualified Commercial Mortgage Lenders have arranged a $130 million commercial loan for covering these three office buildings. The Commercial Mortgage Lenders were able to get a 10-year commercial mortgage with a fixed-rate. Unilev Capital Corporation acquired these three high-profile office buildings for $176 million.
We are unaware if this commercial property was a 1031 Exchange replacement property for the Buyer. These Commercial Properties were acquired by Unilev Capital Corporation. Unilev Capital Corporation has plenty of experience for obtaining Commercial Property. Unilev Capital Corporation was founded in 1992 and is headquartered in Beverly Hills, California. Unilev Capital Corporation also has affiliate offices in Texas, Colorado, Minnesota and New York.
Unilev Capital Corporation is a privately held commercial real estate investment organization. Unilev Capital Corporation has investment strategies that allows them to team up with qualified, limited groups. Unilev Capital Corporation and their joint ventures with affiliated entities acquire well-located, steady income-producing commercial properties. Unilev Capital Corporation investment strategy works with the long-term holding of commercial property that has been researched for investment potential.
The 1031 Exchange candidate is made up of three office buildings with adequate parking for approximately 12,599 cars. This premier Galleria office sub-market, also known as the West Loop, is located approximately five miles west of downtown Houston. The 1031 Exchange candidate has their Office space currently 90% leased. The Houston Commercial Property is leased to Air Liquide, Southern Union, Merrill Lynch, Citigroup Global Markets, Banco Santander and BBVA Bancomer. Another extremely prestigious net lease Tenant is UBS. UBS is an outstanding global financial services firm which offers wealth management, investment banking services, asset management and business banking services.
The Commercial Property seller was Walton Street Capital, LLC. It is unknown if Walton Street Capital used this commercial property to move up to larger properties with a 1031 Exchange. This Company, Walton Street Capital is a private equity commercial real estate investment firm. Walton Street Capital was started in 1994, and since that time their affiliates have prospered. Walton Street Capital affiliates have received total equity commitments of over $5.5 billion from public and corporate pension plans, foreign institutions, insurance companies and banks, endowments and foundations. Also Walton Street Capital has private equity commitments from numerous trusts, and high net worth individual investors.
Unilev Capital Corporation is the third investor – owner of these Houston Office Buildings. These 1031 Exchange candidates were developed in the 1970′s. These Texas Office Buildings were developed by Houston-based Hines. The Commercial Property acquired by Unilev Capital Corporation consists of a total of 1.1 million square feet of Office space described as:
• The 25-story Galleria I at 2700 Post Oak Boulevard, which is anchored by the U.S. headquarters of Air Liquide
• The 22-floor Galleria Tower II is situated at 5051 Westheimer, and has this property has Southern Union Company as their largest tenant. Southern Union Company is currently on the New York Stock Exchange (NYSE). Southern Union Co. recently signed a lease for approximately 192,897 square feet in the Galleria Tower II.
• The seven-story Galleria Financial Center located at 5065 Westheimer and 5075 Westheimer. This commercial property has exceptional net lease tenants as it is anchored by UBS and Merrill Lynch. This office building sits on top of the Galleria mall and comes with two addresses because it includes two offices which are separated by a gorgeous atrium.
The 1031 Exchange candidate is on the Houston Galleria Mall project. This Houston Retail Shopping Center has approximately 3 million total square feet of space which includes 2.4 million of gross leasable area. This thriving retail shopping center has over 375 stores. This retail shopping center would be a nice 1031 Exchange replacement property, as the Galleria Mall is the largest mall in Texas and seventh-largest in the Country. This Houston retail shopping center is currently anchored by Neiman Marcus, Nordstrom, and Saks Fifth Avenue. The Houston retail shopping center also comes complete with two separate, full-line Macy’s retail stores.
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O’Reilly Commercial Realty LLC
Phone: (352) 237-2222