SynerMark Properties has expanded its commercial holdings with the purchase of a 10-story office building on the Northwest side.
The Austin-based investment firm acquired Fountainhead Tower, a 178,000-square-foot Class A building at 8200 Interstate 10, the San Antonio Business Journal reported.
The seller was KBS Realty Advisors; the price wasn’t disclosed, but KBS sold it for a profit, a spokesperson said. Cushman & Wakefield brokers Todd Mills and Hunter Mills represented KBS in the transaction.
The Bexar County Appraisal District assessed the property’s taxable value at $30.5 million, or $170 per square foot. Only about 16,000 square feet is listed as available, meaning it could be over 90 percent leased.
The purchase marks the first of many potential acquisitions for SynerMark in the San Antonio market, said Steve Pyhrr, the firm’s president and CEO.
SynerMark believes San Antonio is well suited to combat persistent macroeconomic challenges because of its rapid growth and diverse mix of industries, said Gio Cordoves, the firm’s Western U.S. regional president.
The building has a good tenant mix, amenities and location, said Ben Bittner, SynerMark’s managing director of acquisitions and asset management.
KBS also sold the Offices at Greenhouse in Houston last year for $17.6 million, or 63 percent less than its previous purchase price, which was part of a planned liquidation of one of its funds.
San Antonio’s office vacancy rate is 16.4 percent, much lower than other Texas metros, but demand is “tepid,” according to Cushman & Wakefield. Year-to-date negative absorption hit 421,000 square feet in the third quarter. The Northwest submarket has the most office inventory in San Antonio by far, with 15.6 million square feet but a vacancy rate of just 14.3 percent.
The submarket’s big leases in the third quarter were streaming service Hulu’s renewal for 30,000 square feet at 4511 Horizon Hill Boulevard, and UT Health Science’s 26,000-square-foot lease at 3826 Medical Drive.
— Andrew Terrell
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