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OKLAHOMA CITY-Taking advantage of a single-digit vacancy in the northwest submarket, Caliber Development Co. has acquired the 268,800-sf Hertz Financial Center. The new owner plans to put additional capital into the 40%-leased building and rename it Caliber Center.

Selling broker Mark Beffort, SVP with Grubb & Ellis Co.’s Oklahoma City office, says similar assets trade for $60 per sf to $95 per sf. Hertz Realty Corp., headquartered in Park Ridge, NJ, bought the building at 3817 Northwest Expressway in 1994. It opted to sell after consolidating operations elsewhere, according to Beffort.

Beffort tells GlobeSt.com that Caliber beat six other bidders vying for the asset because it has the resources and vision to stabilize the building. “A lot of people are looking for stabilized assets. This particular property will take some building up,” Beffort says. “This required a group that had some vision and was willing to assume some of the lease-up risk associate with the property. Caliber offered all of that.”

Beffort says Caliber, primarily known for residential development, also is looking at other potential non-residential deals in the Oklahoma City market. “They’re in the process of buying more real estate,” he says. “They’re optimistic about the Oklahoma City economy.”

Caliber, which is owned by private equity company Wexford Capital LLC of Greenwich, CT, has just completed two 45,000-sf office buildings at the Quail Springs Corporate Park at 14000 Quail Springs Pkwy, about 10 miles southwest of Hertz Financial Center.

Caliber has bought a class A building in a 5.4-million-sf submarket with an 8.3% vacancy, according to Grubb & Ellis’ third quarter 2007 office report. Its tenant roster includes tenants like EOG Resources Inc., Alltel Communications Inc., RKI Exploration & Production, Prudential Insurance Co. of America and United Healthcare Insurance Co. Beffort says the expected lease roll is minimal for the next several years. Local firm Price Edwards & Co. will lease and manage the asset for Caliber.

Beffort points out that Caliber is a fortunate investor because not many office buildings are expected to be on the market in the coming year. “The office buildings in the market here are closely held by maybe five or six different groups in total,” he explains. “Those who are actually holding the buildings aren’t all that interested in selling them right now.”

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