Highwoods Properties Office Buy Ups Bet on Uptown Charlotte

Lincoln Property Company is cashing out of another uptown Charlotte trophy as Highwoods Properties moves to expand its presence at Legacy Union, the 10-acre office district Lincoln developed with Goldman Sachs along South Tryon Street.

Highwoods, the Raleigh-based Real Estate Investment Trust, is under contract to buy Legacy Union 6Hundred, the 24-story, 415,000-square-foot tower at 600 South Tryon Street, The Charlotte Business Journal reported. The sale is slated to close within 30 days.

Highwoods’ total investment is expected to hit $223 million, including $8.5 million earmarked for near-term upgrades and leasing capital to stabilize the building. That’s about $537 per square foot. The tower, delivered earlier this year, is 84 percent leased.

Tenants include Robinson Bradshaw, Pike Corporation, LS3P Associates, Industrious and CohnReznick. American Express is also taking at least two floors, sources told outlet, marking a notable expansion of the financial giant’s presence in Charlotte.

Highwoods CEO Ted Klinck framed the deal as another step toward consolidating the REIT’s position at Legacy Union, which he called a hub for “commute-worthy office” — shorthand for well-located buildings full of amenities able to command premium rents. Klinck said in-place rents at 6Hundred sit more than 20 percent below current market levels, giving the REIT a clear runway for cash flow growth. The purchase will be funded by selling noncore assets over the next six months.

The acquisition deepens Highwoods’ relationship with Lincoln at the project. The REIT already owns the Bank of America Tower — acquired for $441.6 million in 2019 — and the SIX50 building, purchased for $201.2 million in 2022. In August, Highwoods paid $110 million for Legacy Union’s 1.1 million-square-foot parking garage at 720 South Church Street, which includes more than 3,000 spaces and a block of ground-floor retail.

Legacy Union has become one of Charlotte’s defining corporate nodes since its first buildings were delivered in 2019. Honeywell opened its headquarters there in 2021; that building traded hands later that year, when Lincoln and Honeywell sold it to PRP Real Estate Investment Management for $275 million. The district’s mix of new office towers, structured parking and ground-floor retail has drawn blue-chip tenants even as broader office fundamentals soften.

If the 6Hundred sale closes as planned, Highwoods will control 1.6 million square feet at Legacy Union.

— Eric Weilbacher