San Fran-based investment group pays $61.5M for Siemens HQ in east Orlando

Bob Moser
GrowthSpotter

An investment vehicle managed by San Francisco-based Stockbridge Capital Group paid $61.5 million on Friday for Siemens Energy's Americas headquarters building in east Orlando's Quadrangle business park. 

Located at 4400 N. Alafaya Trail, the 95.6-acre property lies just west of the University of Central Florida, and features Siemens largest office building in the country with nearly 250,000 square feet of conditioned area over four stories, built in 1983. 

The deed was recorded late Friday afternoon by Orange County's comptroller office. A Siemens spokeswoman told GrowthSpotter the deal was a sale-leaseback for 10 years, and is part of the company's overall asset management strategy that involves selling some of its properties across the country.

The acquisition is Stockbridge's first individual asset buy in Greater Orlando, though it owns one industrial property in Orlando Central Park that was part of a past portfolio acquisition.

"Orlando's growth story has been national news for some time, you've led the country three years in a row in employment growth," said Jeffrey Brunette, vice president of acquisitions for Florida. "What attracted us to this deal was a long-term lease for a global credit tenant, and it resonated well with our client."

That client was a private international fund, said Brunette, who declined to share further details. The property had been marketed by CBRE Orlando's Ron Rogg

Orlando is the Americas headquarters for Siemens Energy, a division of Siemens AG, and is also the global headquarters for Siemens Energy's Service division. The company has more than 10 offices in Greater Orlando, and its Energy divisions based locally include Fossil Power Generation, Energy Service and Wind Power.

Siemens' Real Estate business unit is also based in east Orlando, and is responsible for managing the company's real estate portfolio, leasing and disposing of assets and implementing all construction projects Siemens-wide. 

A wind service training center established in Orlando in 2013 is one of four that Siemens has in the world. The company employs more than 3,800 in the Orlando-Kissimmee metro area across multiple offices, according to past marketing materials. 

Stockbridge invests across the risk/reward spectrum in core, value-added and opportunistic real estate assets. The Siemens property in east Orlando falls in the "Core" category. 

Looking forward, Stockbridge is actively looking to Greater Orlando for more acquisitions across a range of commercial property types, said Brunette, and has several buckets of capital to pull from, including a core fund and a value fund series. 

Stockbridge began raising funds in September 2016 for its Stockbridge Value Fund III, and in April held a $355 million final close, reported Institutional Real Estate, Inc. The company plans to target a range of commercial properties with value-add potential. 

Other Core and Value-Add acquisitions made by Stockbridge in the first quarter of this year totaled 844,823 square feet of Class A office space, 332 Class A multifamily units and nearly 292,000 square feet of industrial space. Office tower and apartment complex assets in South Florida were among its acquisitions this year. 

A Siemens Real Estate affiliate initially invested $9 million to buy the property in 1998, and most recently it and Siemens Corp. paid $34.8 million in June 2017 to take title of the property. 

Have a tip about Central Florida development? Contact me at bmoser@growthspotter.com, (407) 420-5685 or @bobmoser333. Follow GrowthSpotter on Facebook, Twitter and LinkedIn.

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