CONROE, TX-In an unsolicited bid, a company from down under has taken ownership of a two-building, 81,052-sf office property. The fully leased, class B property in the far north submarket has sold for $9.25 million. The deal traded at a 7.92% cap rate.

Huntsville Investments LLC put several million into renovating common areas and the exterior of the late 1970s-era complex. Marshall Willey, a broker from Huntsville and one of the selling partners, says their plan was to hold the property at 100 Interstate 45 indefinitely, but the offer from 100 North Freeway Investments LLC was one that the owners couldn’t refuse.

Willey tells that the buildings were 50% leased and not in good shape when he and his partners acquired the complex in the mid-1980s. But, that’s changed significantly. “There is a great mix of entrepreneurial types and law firms and energy-related companies here,” says Willey, whose company has space in one building. “Most of the leases signed are three to five years and nothing’s expected to roll in 2007 or 2008.”

In addition to a steady tenant base, the far north submarket is picking up steam. “The Conroe market was formally perceived to be too far out, however, with the shift in demographics, well-maintained outlying office buildings have become attractive to businesses who see advantages to establishing their offices closer to their work force,” says Henry Hagendorf, senior investment adviser with Sperry Van Ness in Houston. He and Sperry colleague Brian Hines brokered the sale.

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