January 8, 2019
By Lori Hawkins
Private equity giant KKR has purchased an eight-building office campus in Northwest Austin that includes Apple and Allergan among its tenants.
The acquisition of Riata Corporate Park is valued at about $258 million, according to KKR.
Riata, which was built between 1998 and 2000, is a 688,100-square-foot complex on 51 acres located between U.S. 183 and West Parmer Lane.
The deal includes an adjacent 5.64-acre parcel that is approved for development of a new 64,550-square-foot office building.
KKR said it is planning an $11 million capital improvement program to the campus including adding amenities such as fitness centers, a cafe and outdoor plazas.
In addition to Apple and Allergen, tenants at Riata include Accenture, UnitedHealth Group, Conduent, Abrigo and Sonic Healthcare.
“Riata is a unique corporate campus centered in an incredibly dynamic area in Austin, one of the fastest growing markets in the U.S.,” said Roger Morales, a partner at KKR and head of commercial real estate acquisitions in the Americas. “We are thrilled to be investing in the property and the region, and look forward to continue building upon its best-in-class position.”
The deal is the first investment in an Austin property by New York-based KKR, which is a global investment firm with more than $208 billion in assets under management.
KKR purchased Riata from Partners Group, a global private markets investment manager, and Accesso Partners, a Florida-based real estate investment manager. The two firms purchased the property in 2015 for an undisclosed price.
“Partners Group had high conviction in the strength of the Austin office market when we partnered with Accesso to acquire Riata Corporate Park,” said Ron Lamontagne, managing director at Partners Group. “As employers in the tech and pharmaceutical industry relocated to or expanded in Austin, we were able to use our operational expertise to develop Riata into a highly-attractive asset. Limited large block vacancies, the ability to develop an additional parcel, and the credit rent roll, led us to believe that this was a good time to market the property to a buyer who had a long-term vision for the asset.”