Saker Capital Advises Regent Properties on the newly formed JV with South Korea’s Hana Alternative Investment Management, on the recapitalization of 216,000 square foot Class A Office in Dallas MSA.

October 30, 2020 – Saker Capital advised Los Angeles-based Regent Properties on the newly formed JV with South Korea’s Hana Alternative Investment Management, an investment arm of Hana Financial Group, on the recapitalization of Legacy Central 4.

Regent Properties CEO Eric Fleiss is happy to have the new relationship with Hana and he hopes the company can keep building on the partnership. He declined to disclose the terms of the deal, which was first reported by South Korean publications. “There was an obvious attraction by Hana with Samsung as the tenant,” Fleiss said in an interview. “This long-term lease with Samsung gave us the ability to tap into a highly valued income stream,” he added.

The two-story, 216,000-square-foot office building is in Plano, Texas, about 23 miles north of downtown Dallas, and is fully leased to South Korea-based electronics company Samsung. The Samsung lease helped lure the fund, Hana Alternative Investment U.S. Real Estate Investment Trust 1, for the off-market deal that is expected to capitalize on the ongoing evolution of the mixed-use, multibuilding Legacy Central campus.

Fleiss said Regent Properties is happy to have the new relationship with Hana and he hopes the company can keep building on the partnership. He declined to disclose the terms of the deal, which was first reported by South Korean publications.

“There was an obvious attraction by Hana with Samsung as the tenant,” Fleiss said in an interview. “This long-term lease with Samsung gave us the ability to tap into a highly valued income stream,” he added.

Regent Properties first bought the nearly 1 million-square-foot campus five years ago from Texas Instruments with plans in tow to upgrade the campus into a walkable mixed-use destination. As those development plans took shape, Regent Properties landed a long-term lease with Samsung for the entirety of Legacy Central 4, a two-story, 216,000 square-foot office building. Samsung’s lease runs until 2030.

Hana Alternative Investment Asset Management CEO Kim Hee-seok told the Korean news publications that finding long-term leases to high-quality tenants has become more difficult because of the prolonged pandemic, but they were able to find the deal based on the firm’s “solid overseas real estate investment track record and continuous investment diversification strategy.”

Fleiss said Regent Properties has several large tenant leases in letter-of-intent discussions, which could land by early next year. He declined to disclose the “large tenants” behind those discussions, but said he expects them to bring more diversity to the campus, which is known for attracting high-tech companies. Other tenants at the campus include Peloton and Ribbon Communications.

“We’ve seen an increase in leasing as a result of the pandemic,” he said. “We are seeing a push from office tenants in towers to low- to medium-density style office  buildings where employees don’t have to wait in an elevator and have easy access to their office.”

Meanwhile, the Legacy Central campus is continuing to evolve, with hundreds of apartments being built near the campus by Trammell Crow Co. in the last year. The developer is finishing construction on a food court and additional retail space on the campus. Plans for a proposed hotel on the campus have been put on hold with the ongoing pandemic, Fleiss said. Regent Properties is also shopping an office development site with the ability to construct 300,000 square feet to 500,000 square feet of office space in a build-to-suit project.

Unlike landlords in high-density urban cities, Fleiss said the suburban Legacy Central campus is not as exposed to the uncertainty in the office market tied to the permanency of work-from-home and social distancing practices. Like landlords, he said, certain industries are more exposed than others.