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HOUSTON-Barnhart Interests Inc. has obtained $23 million in debt and equity financing from American National Insurance Co. to reposition and re-tenant one of the largest office buildings in the Bellaire submarket.

The local owner of 6330 W. Loop South took on its first joint venture equity partner in structuring the deal with Anico. “Our joint venture with Anico allows us to have the funds to renovate the lobby and offer aggressive TI packages and commissions,” Paul Barnhart of Barnhart Interests tells GlobeSt.com. The building will undergo roughly $5 million of renovations, bringing the 293,796-sf, 14-story structure to a class B-plus level.

The building, positioned on five acres near the corner of Loop 610 and Bissonett Street, formerly housed ConocoPhillips Co.’s exploration and production group. The group moved out of 260,000 sf, but is working with Barnhart Interests to sublease the space. Because the energy company’s lease doesn’t expire until March 2008, the building is 92% leased from an economic standpoint although it’s only 40% physically occupied, according to Barnhart. Sublease space is quoted at $8 per sf; direct space, $18.50 per sf.

Barnhart says renovations and leasing efforts will begin immediately. The updates are scheduled to be done by yearend. “It’s a great building and now it’s back in play,” he says, adding the fresh capital erased an $18-million loan against the building.

Gary Dunkum and Hal Holliday with Houston-based Live Oak Capital LLC arranged the loan, which closed at sub-6% fixed-rate interest with a six-year term at interest only. “Anico really liked the building and the fact that there is plenty of time left to reposition the property before ConocoPhillips stops paying rent,” Holliday says.

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