Done Deals: Jan 10, 2025

Friday, January 10, 2025

KBS Sells 179,932 Square-Foot, Class A Office Building in San Antonio, TX

Tina Ross

SAN ANTONIO, Texas (January 10, 2025) – KBS, one of the largest owners and operators of premier commercial real estate buildings in the nation, announces the sale of Fountainhead Tower, a 179,932 square-foot Class A, office property, located in the Northwest submarket of San Antonio, Texas.

Home to a mix of regional and national tenants, the property was sold to a partnership organized and managed by SynerMark Properties Inc., a full-service real estate investment and services firm based in Austin, Texas.

Amanda Kennedy

Attorneys Bruce Fischer, Howard Chu, and Tina Ross, and paralegal, Amanda Kennedy, of global law firm Greenberg Traurig, LLP’s Orange County and Texas offices represented KBS as legal counsel in the disposition.

Thanks to a solid local economy, San Antonio and other major markets in Texas continue to attract investors looking for high-performing Class A office properties, according to Gio Cordoves, regional president, Western U.S., for KBS.

Bruce Fischer

Situated on the southern edge of Texas Hill Country, San Antonio has emerged as a high-growth business center. Despite ongoing national economic challenges, the San Antonio market is positioned to counter these obstacles due to its diverse industry base. Key industries such as healthcare, manufacturing, and a number of Army, Navy and Airforce bases anchor the local economy, contributing to a stable unemployment rate of 3.7%.

Howard Chu

As in prior periods, San Antonio witnessed sustained job growth, with nearly 28,000 jobs added on a year-over-year basis. Employment is projected to rise, maintaining the city’s growth trajectory, according to Cushman & Wakefield’s Q3 2024 San Antonio MarketBeat Report.

Gio Cordoves

As companies exhibit greater confidence in the economy, the office sector is poised to see positive impact across Class A assets,” says Brett Merz, asset manager of Fountainhead Tower, co-director of asset management and senior vice president at KBS. “Fountainhead Tower will increasingly benefit from improving real estate tailwinds.”

Fountainhead Tower is located approximately 10 miles northwest of downtown and just minutes from the San Antonio International Airport. The building sits on a 5.6-acre parcel beside the I-10 Freeway close to the 410 Loop for easy accessibility. An adjacent five-level, 627-space parking garage accompanies the property.

Brett Merz

“SynerMark identifies cycle-driven acquisitions where our management team can execute its long-term investment strategy,” says Ben Bittner, managing director of acquisitions and asset management at SynerMark Properties. “Fountainhead Tower is an excellent asset for our portfolio with a strong tenant mix, excellent amenities, and great location in fast-growing suburban San Antonio.”

Fountainhead Tower, a 179,932 square-foot Class A, office property,

located in the Northwest submarket of San Antonio, TX

SynerMark Properties President and CEO Steve Pyhrr, and a former real estate professor at the University of Texas, said that, “The Fountainhead property is the first of several outstanding acquisitions planned for San Antonio over the next few years.”

Steve Pyhrr

Todd Mills, executive managing director, and Hunter Mills, director of Cushman & Wakefield represented KBS in the sale transaction.

“For the past 10 years, Fountainhead Tower has exhibited extremely stable rent rolls with an average occupancy of over 90 percent,” says Mills. “It has consistently attracted a diverse roster of high-quality national and local firms as tenants. It was our pleasure to assist in finding a buyer for the property and getting excellent value in the current real estate cycle.”

Todd Mills

According to Fischer, Greenberg Traurig’s chair of the west coast real estate practice and co-managing shareholder of the Orange County office, who led the Greenberg Traurig team, “We were pleased to work with KBS in the sale of Fountainhead Tower. Texas has exhibited a resilient office real estate market thanks to its growing office-based employment.”