NY firm buys Research Tri-Center warehouses for $76.95 million

In the latest sign of investors strong appetite for high-profile commercial real estate in the Triangle, a private New York real estate investment firm has paid $76.95 million for the Research Tri-Center buildings in Durham, according to Durham County property records.

Northwood Investors purchased the 1.5 million square feet of warehouses and offices near Research Triangle Park from Grosvenor Investment Management, a subsidiary of a London investment firm that paid $105.5 million for the property in 2007 at the peak of the market.

Grosvenor's purchase price, about $70 per square foot, was roughly twice what the previous owner, Chicago-based Transwestern Investment, paid in 2005.

Northwood paid about $51 per square foot.

Research Tri-Center includes eight industrial buildings, a flex building and an office building. 

Research Tri-Center is currently 88 percent leased to 26 tenants including GlaxoSmithKline, UPS, FedEx Ground, Verizon and Parata Systems.

While Northwood's purchase price for the 130-acre campus is significantly less than what Grosvenor paid, it is an impressive figure given the state of commercial real estate.

The Triangle warehouse vacancy rate was 15.3 percent in the first quarter, up from 9.8 percent during the same quarter a year ago, according to Karnes Research.

The warehouse vacancy rate in the I-40/RTP submarket stood at 11.4 percent in the first quarter, up from 9.9 percent a year ago.

The Research Tri-Center deal is the largest transaction in the Triangle since Texas real estate firm Hines Global REIT signed a contract to buy Hock Plaza I, one of the Triangle's trophy office properties, for $98.3 million.

Many institutional investors have been eyeing the Triangle during the downturn.

Thus far, investors with cash have focused mostly on the really solid properties or those in trouble, partly because there has not been nearly the number of properties coming on the market as many people expected.

That's increased competition for the few prized properties that are available.

Cassidy Turley brokers Rob Cochran, David Finger and Tom Powers handled the sale, and Chris Norvell and Jim Allaire will be responsible for leasing the property with the new owners.