Oak Hill Advisors Leads Group Investing $326.5 Million in Suburban Office Property Company

An investment group led by Oak Hill Advisors’ new real estate business is investing $ 326.5 million in a suburban office building company on the premise that the property type will benefit from the accelerated shift in work and life patterns caused by the pandemic.

Oak Hill’s real estate unit is making a debt and equity investment in Workspace Property Trust LP, a six-year-old company that owns 10 million square feet of office space primarily in suburbs of Tampa, Florida, Phoenix, Minneapolis, Philadelphia and other markets. The deal will help Workspace go shopping for the next five years, said Tom Rizk, the commercial real estate veteran, co-founder and CEO of Workspace.

“We aim to make $ 5 billion in acquisitions over a five-year period,” he said.

The transaction marks the first investment by Oak Hill’s new real estate division since last fall, when Matt Borstein, Deutsche Bank’s former global director of commercial real estate, was hired. Oak Hill manages more than $ 50 billion in capital with a focus on distressed and distressed credit investments.

Mr Borstein said the new deal was originally planned to focus on the “historic fault” many investors in the commercial real estate market had been expecting from the pandemic. But that didn’t happen, thanks in part to Federal Reserve monetary policy.