Truist Buys NuStar’s San Antonio HQ in $103M Leaseback

An energy logistics company is selling its San Antonio headquarters but will remain at the site as part of a leaseback deal.

Truist Financial Corp is buying the 1 million-square-foot campus at 19003 West Interstate 10 from NuStar Energy for $103 million, the San Antonio Business Journal reported. NuStar will continue to operate within a 300,000-square-foot space at the site, paying roughly $8.2 million a year in rent for the initial 20-year term of the leaseback agreement.

NuStar, whose CEO is Brad Barron, has the option to extend its lease through two additional 10-year periods until March 2063. The 32-acre property was recently valued at about $49 million, according to the Bexar County Appraisal District.

The agreement restricts future developments on a 6-acre portion on the southern edge of the lot as long as NuStar or any NuStar affiliate operates there. NuStar also retained 13 acres of the property.

The deal was made to monetize a real estate asset that hasn’t been yielding lucrative returns, and NuStar will pay off some of its outstanding debt with the $103 million, a company spokesperson told the outlet.

Amid high interest rates, the deal was an efficient way to gain equity quickly, while remaining “good stewards” of its resources, the spokesperson said.

Other notable companies have exercised land sale or leaseback maneuvers recently. Austin-based Capital Commercial Investments bought 290 acres at ExxonMobil’s Irving headquarters late last year in a sale-leaseback deal in December. And Houston-based natural gas company Tellurian is selling land in Louisiana as part of a $1 billion lease back, the outlet reported.

—Quinn Donoghue