BETHESDA, MD-Last week The Pinkard Group popped up on local industry's radar with the acquisition of Lakeside III @ Loudoun Tech Center from a special servicer. The Pinkard Group partnered with Buchanan Partners of Gaithersburg, MD and AEW Capital Management to buy the 101,787-square-foot building, one of three on the 30-acre campus.

GlobeSt.com caught up with two of the firm's principals after transaction was announced to get their take on this asset in particular and their investment approach to DC area real estate in general. Lakeside III was an off-market deal, and as the executives--Bob Pinkard, principal and founder of The Pinkard Group, and Peter Kleeblatt, principal responsible for leading the investment origination--quickly made clear, off-market deals are their specialty.

Indeed, since the company's founding, many if not all of the properties the company has acquired originated as off-market transactions, although in a few cases the company joined as a partner in a marketed transaction.

Properties the group has acquired include Cameron Park, in Alexandria, VA, a mixed-use complex of 390 apartments and 37,000-square feet of retail; the VFW site in Frederick, MD, an entitlement and development site of 260 townhouse and two single-family lots; and the Petworth Apartments, a value-add multifamily project at 3728 New Hampshire Ave. in the District. Following are excerpts from their interview.

GlobeSt.com: So tell me more about the Lakeside transaction. Why that particular asset?

Kleeblatt: One thing to highlight about that deal is that it really speaks to our platform and our approach of focusing on off market transactions, especially with a special servicer. We identified this opportunity many months ago.

GlobeSt.com: And how would you describe your platform? Is it a focus on distressed or value-add assets?

Kleeblatt: All that, yes, but our business to date has been focusing on sourcing opportunities that are not well known in the market.

We try to uncover opportunities that may not be as competitive as a deal that would go to one of the brokerage houses.

GlobeSt.com: Why don't you go after marketed deals?

Pinkard: We have tried, we just haven't succeeded when we did. We might see something we like that is marketed, compete for it and then someone else gets it in the end. Then we say to each other 'we are not doing anything else ever again that is marketed.'

GlobeSt.com: So you've sworn off marketed transactions?

Pinkard: Well, I wouldn't say that. Anyone that is focusing on the off market has to pursue marketed deals to get price transparency.

I would say our ratio of transactions is 75% off market and 25% marketed deals and we examine what we are doing from time to time to make sure we are consistent with that ratio.

We have done six deals and while some were marketed we didn't go through a beauty contest to get the property.

GlobeSt.com: How do you find these transactions?

Pinkard: Just from our relationships in the market and being out there. Also we follow properties we like and keep in touch with the owners.

Kleeblatt: We also find opportunities through our partners like Buchanan. They are a great partner. Partners are good way of being exposed to other properties and the flexibility of our structure and investment fund allows us to be either the sponsor or an investor or sometimes both. That makes us attractive to different people at different times.

GlobeSt.com: What are your plans for the rest of the year?

Pinkard: We are very interested in value add office right now. We hope to do two more transactions this year.

Instant Insights /

Pinkard Group: Why We Like Off-Market Deals

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