PORTLAND-Locally based NBS Real Estate Capital and Capstone Partners LLC have acquired 100 West Liberty St., a 12-story, 150,000-sf class A high-rise office building and 100,000-sf parking structure in Downtown Reno. The building is 84% leased. The purchase price was $20 million.NBS Real Estate Capital chief executive Rance Gregory tells GlobeSt.com the purchase was made on behalf of its $30-million (equity) discretionary fund, whose investors include pension funds, foundations, charitable trusts, corporate investors and high-net-worth individuals. The fund is the primary investor and Capstone is the minority investor and asset manager, he says.Gregory says the reasons for the acquisition include the quality of the asset and its tenants, recent public and private investment in and around the property, the building’s relatively high parking ratio and the fact that Capstone managing principal Chris Nelson has specific knowledge of the market. “Before [Nelson] came up to run Portland, he was the lead in Reno for 10 years and knows that market very well,” says Gregory.Nelson tells GlobeSt.com he has been working on the acquisition “on and off” for about 18 months. “It’s a big building in the Reno market dollar-wise, but is a little smaller than the big institutional players are looking for and a little bigger than the local players would look for,” says Nelson. “The sellers were the developers and they were maximizing their cash flow; the building needs new energy, some capital investment and a new approach.”There are currently 16 tenants in the building and there are five suites available. Tenants include Grant Thornton, Jones-Vargas and the federal government. The building is located adjacent to the new Nevada Museum of Art and within walking distance to all of the County, Federal and Municipal court complexes. Nelson says NBS and Capstone will invest significant capital to improve the common areas of the building, including the lobby, elevators areas and restrooms. Gregory says the seller was having some success marketing the building when Nelson first became interested, but the Hale Lane law firm moved out of the building, creating a large vacancy that scared most investors away. Knowing the building and the market, however, Nelson hung around, and the space was ultimately backfilled by another law firm and other credit tenants. “Originally, the asking price was higher,” says Gregory. “When that tenant moved out, we were able to get price we wanted.”The Reno building is the NBS fund’s fourth investment. One of the investments, a small mezzanine loan, has been paid back, and another investment in Seattle is under contact. Gregory says he would expect that with leverage the portfolio would have an interest in between $200 million and $300 million worth of real estate in Oregon, Washington, Idaho and Nevada by the time it is done investing about 12 months from now. “We’re looking in all the four main food groups,” says Gregory. “Office, Industrial, retail and multifamily.”

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