Saudi-based Sidra Capital has announced its first foray in the US real estate market with acquisition of an office building in a deal worth SR350 million ($93.3 million).
The investment firm said in a statement that the building in Fort Mill, South Carolina is leased to a subsidiary of Amerisource Bergen Corporation, a Fortune 500 company.
The property features 23,000 sq m of office accommodation over five floors with 1,485 car park spaces, it said.
“This transaction will inevitably widen our geographical footprint and help in the search for future acquisitions,” said Hani Baothman, vice chairman of Sidra Capital.
“The strategy for this project is to provide our investors with highly attractive returns backed by a secure tenant combined with recently constructed facilities, whilst pursuing opportunities to increase value to the property.”
He described South Carolina as an 18-hour city, a second-tier city with above-average urban population growth. In real estate investing, 18-hour cities are seen as viable investment alternatives to the “big six” markets of Boston, Chicago, Los Angeles, New York, San Francisco and Washington DC.
“18-hour cities have emerged as a more affordable investment option compared to larger markets,” added Currim Oozeer, CEO of Sidra Capital. “These cities are attractive because they typically feature lower cap rate compression, meaning property values tend to remain stable rather than spiking up or down significantly.”
Sidra Capital, which is the strategic advisor on the project, has assets under management in excess of SR3.3 billion.