BH Properties looking to spend $250M for new acquisitions

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Private L.A.-Based Company Plans to Expand On Successful 2006; Bullish On Texas, Southeast
Following what it described as a very successful 2006, privately held BH Properties has $250 million in hand for new acquisitions this year.

The Los Angeles-based company, which specializes in value-added investments in major metro and secondary markets, aims to meet its growth target of $600 million in new properties by the end of 2007, according to its president, Steve Gozini.

The company inked $100 million in investments last year representing a 25% increase in the value of its portfolio, said the company’s executive vice president and general counsel, Steve Jaffe.

BH’s growth strategy to acquire value-added retail, office and warehouse/industrial properties "in targeted regional markets at the right time," prospering in a niche not filled by big institutional or individual private equity capital, Gozini said.

"Properties that do not meet the criteria for acquisition by large institutional investors or individual investors often prove to be our most profitable investments," he said.

The company plans to continue to acquire property in areas its principals believe to be hot markets with big upside such as Georgia, Texas, North Carolina and Virginia. BH Properties also invested in North Carolina, Virginia and Idaho assets for the first time and opened an office in Denver in 2006. The company is recruiting directors to manage its southeast U.S. assets and investments.

BH Properties’ lists its preferred markets as Alabama, Arkansas, Arizona, California, Colorado, Florida, Georgia, Kansas, Louisiana, Nevada, New Mexico, North Carolina, Oklahoma, Oregon, South Carolina, Texas, Utah, Virginia and Washington.

The biggest of BH Properties transactions in terms of size and dollar value last year were in Texas: the company acquired a 665,000-square-foot warehouse/distribution center in a sale/leaseback in El Paso valued at $14 million. In other Texas deals worth a combined $17 million, it picked up a 375,000-square-foot industrial property in El Paso, a 209,000-square-foot industrial building in McAllen and a 55,552-square-foot retail site in Greenville.

The company also acquired former Winn-Dixie anchored retail properties in Georgia and Florida, a 63,000-square-foot class A office building in Glen Allen, VA; a 58,000-square-foot retail property in Caldwell, ID and a 118,000-square-foot corporate office in Provo, UT. The latter, a partial sale-leaseback between SirsiDynix Corp., was valued at $12.5 million.

Source : CoStar Group

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