The RREEF Funds has completed a $30 million acquisition of the Dulaney Center office complex in Towson, an investment geared to take advantage of the local suburban office market's recovery.
The two-building complex and adjacent garage marks the San Francisco-based pension fund adviser's largest investment in the Baltimore metropolitan area since 1986, when the company purchased the Annapolis Mall.
"It's got a real sense of place," said Stephen L. Grant, a RREEF vice president. "It's very difficult to find those types of investments, even nationally."
In addition to Dulaney Center, at the intersection of Dulaney Valley Road and Fairmount Avenue, RREEF controls 51 million square feet of commercial space nationwide valued at $5.6 billion. The company had contracted to acquire Dulaney Center in March.
Mr. Grant added Dulaney Center's sense of place is enhanced by the 306,000-square-foot project's proximity to the Towson Town Center mall, as well as a lack of new office construction and a falling vacancy rate in Towson.
Since the end of 1993, Towson's office vacancy rate has dropped by more than one-third, causing rental rates to edge upward. The vacancy rate now stands at roughly 11 percent, according to statistics compiled by Colliers Pinkard.
The nine- and five-story buildings are 97 percent occupied by MBNA America, MCI Telecommunications, U.S. Fire Insurance Co., and others, and are projected to generate $5.6 million in rental income next year.
Although the purchase includes a seven-level, 1,544-space parking garage linked to Dulaney Center, the adjacent 284-room Sheraton Baltimore North hotel will be unaffected.
RREEF was represented in the transaction by Rosenthal-Shuler Realty Partners Inc., a Virginia brokerage firm, while Pinkard negotiated on behalf of the seller, the Meridian Group Inc.