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RALEIGH, NC-Two Midwest firms have joined together to purchase a 631,582-sf office flex portfolio for $56.25 million, giving both an entrance into the metropolitan market. Lutz Real Estate Investments, acting on behalf of Raleigh Flex Investor I LLC and Raleigh Flex Investor II LLC, and Capri Capital Partners of Chicago acquired the two-property portfolio from FirstCal Industrial 2 Acquisitions LLC–itself a joint venture of First Industrial Realty Trust and CalSTRS.

The 631,582 sf spans 11 single-story office flex buildings within two business parks: Perimeter Park, now known as EastRidge at Perimeter Park, and Spring Forest Business Center. Adam Lutz, principal of the Farmington Hills, MI-based Lutz Real Estate Investments, tells GlobeSt.com the deal carried an approximate 7.5% cap rate.

East Ridge at Perimeter Park contains 477,495 sf in eight buildings and the tenant roster lists 18 companies, mostly tech firms and laboratory users. Located in the RTP/I-40 submarket, the park is two miles from RDU International Airport and near Duke University, University of North Carolina and North Carolina State University.

Spring Forest Business Center contains 154,087 sf in three buildings and the tenant roster lists 15 companies. It is located in the US1/Capital Boulevard submarket.

According to Lutz, the parks register a combined 79% occupancy. “The Raleigh market is in an upswing and with the new ownership we are bringing in a new leasing and management team, Colliers Pinkard,” he explains.

In connection with the new marketing initiative, both properties will receive minor facelifts, Lutz adds, including new signage, and the rebranding of Perimeter Park to EastRidge at Perimeter Park, “to set is apart bringing recognition to the property and the new ownership.”

He also tells GlobeSt.com that future plans call for new signage at each entryway and directional signs, replacing the balance roofs if they are original, updates to the HVAC systems, parking lot improvements and landscaping to enhance curb appeal.

The JV received acquisition financing through iCap Realty Advisor’s Michigan office and was provided by UBS/Dillon Read Capital Management, repped by executive director Matthew Kirsch. The sale was negotiated by Rick Brugge of Colliers Arnold-Tampa, with Chris Norvell and Hillman Duncan of Colliers Pinkard-Raleigh.

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