Weak demand has led Endeavor Real Estate Group to divvy up a San Antonio office complex that it’s been trying to sell for almost two years.
After struggling to land a buyer for the three-building Forum Offices, at 8000 Interstate 10 West on the city’s Northwest Side, Endeavor has listed each structure separately, the San Antonio Business Journal reported.
Lack of buyer interest in the 381,000-square-foot complex is reflective of San Antonio’s sluggish office market, which is still grappling with challenges posed by the pandemic. The remote-work era has driven office vacancies to new heights, crushing property values and deterring investors as a result.
A lack of offers, along with gloomy market conditions and one tenant’s planned departure, prompted Endeavor to get creative with the listing, said Mark Krenger of JLL, the brokerage that’s marketing the property.
“This is an opportunity, based on some of the trends that we’ve seen, for a tenant or buyer to come in and buy a great building as part of a larger project that has historically been very well-occupied by some of San Antonio’s best corporate citizens,” Krenger told the outlet.
One of the buildings up for grabs is Forum Two, spanning 86,500 square feet and partially leased by Centene. Notably, the health care company is looking to shed most of its footprint via sublease.
Although an asking price has not been disclosed, the property as a whole carries an appraised value of $52 million, the outlet said.
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The complex is 90 percent leased. That’s better than the San Antonio average of about 81 percent, according to CBRE.
Endeavor bought it in 2015 with the help of a $41.7 million loan, which was extended prior to its original maturity date in 2021.
While Endeavor’s approach to selling the complex is more commonplace in markets like Dallas and Houston, where large office complexes are abundant, it’s a relatively novel concept in San Antonio real estate.
—Quinn Donoghue