Title Company Buys Its Own Building
Mar 2, 2012
Independence Title Co., Texas’ largest title company, is moving its statewide headquarters into a larger space and expanding into Houston.
The company, which employs about 185 people here — 67 at its headquarters — and had revenue of more than $33 million in 2011, has outgrown its 17,500-square-foot main office in North Austin at the Arboretum.
It bought a 45,000-square-foot office building at 5900-2 Shepherd Mountain Cove in Northwest Austin, which will become its permanent home starting in 2013.
The building is currently 75 percent occupied, and when the existing tenants choose not to renew their lease, Independence Title expects to swallow up the space. In the meantime, Independence Title will reap the benefits of being a landlord.
“This represented a good long-term strategy for us, in terms of our real estate needs,” said Independence Title CEO Jay Southworth, who hopes to grow the company to the point where it will take over the entire building.
The company currently has 32 offices stretching from Austin to San Antonio and employs more than 250 people.
He said it was a great buy for the company, in terms of price, and because it will generate substantial rental income. Southworth declined to specify the purchase price but a brochure marketing the building listed the asking price at just under $5 million.
Independence Title partnered with Aquila Commercial LLC, an Austin-based commercial real estate firm, on the deal. The building’s seller was represented by brokers Matt Levin and Patrick Ley with Equitable Commercial Realty.
“Our initial intent was to bid on the property ourselves,” said Victor Young, an Aquila investment advisory services representative. “We believed in the long-term viability of the building.
Independence Title’s deal is not unique. Several local businesses have gone from tenant to owner recently.
“There’s an increased sense of optimism being felt by a number of businesses, in terms of their economic futures, and owning real estate can be a stabilizing force for their bottom line,” Young said.
If companies have the cash it’s relatively easy to buy space now because there aren’t many bidders in some cases. The recovery is indeed in full swing but capital and investors are still moving slower than usual.
Additionally, Independence Title is expanding into the Houston market as part of its strategic growth plan.
The company, which handles transactions throughout Texas, has been closing deals in Houston since it was founded in 2005, Southworth said. Recently, however, its business there has been increasing.
The company has started looking at different office opportunities in Houston through existing relationships.
Dallas is on the radar for Independence Title Co. also, but the company takes a cautious approach when entering new markets, Southworth said.