Pacific Oak Opportunity REIT Sells Park Highlands Acreage in Vegas for $223 Million
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Pacific Oak Strategic Opportunity REIT Inc., a publicly registered non-traded real estate investment trust formerly known as KBS Strategic Opportunity REIT Inc., closed on the final phase of three transactions to sell a total of 501 developable acres of land in North Las Vegas, Nev., to buyers unaffiliated with the company: Forestar (USA) Real Estate Group Inc. and D.R. Horton Inc.
As reported by the REIT during an August 2024 presentation to stockholders, the Park Highlands land sales “closes out an incredibly profitable and timely investment by the company, which had acquired the large acreage during joint venture deals in 2011 and 2013 at the depths of the housing bust, and then subsequently bought out its joint venture partners.” At the time of the partner buyouts in 2016, the company said its acquisition basis was just $68.4 million, or $55,000 per estimated developable acre.
The aggregate gross sales proceeds were $223.1 million, before closing costs, taxes, reimbursements, and credits.
As of June 30, 2024, the REIT estimated its portfolio value at $1.97 billion. Its primary investment types were office (46.1%), residential homes and apartment (32.8%), and land (17.9%).
Pacific Oak Strategic Opportunity REIT closed its initial public offering on Nov. 20, 2012. On Oct. 1, 2020, Pacific Oak Strategic Opportunity REIT II shareholders approved the merger into Pacific Oak Strategic Opportunity REIT. This REIT was designed to capitalize on the dislocation, lack of liquidity, and government intervention that exists in the commercial real estate markets by acquiring a diverse portfolio of opportunistic investments in discounted debt and distressed equity assets. The REIT seeks to provide stockholders attractive total returns through the purchase of non-performing loans at favorable prices and real estate from distressed sellers.
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