The Upside of a Down Economy: Lone Star College Gets Big Deal on Big Purchase

The Wall Street Journal says that some investors would love to have the real-estate sense of the Lone Star College System. The college system bought an eight-building, 1.2-million-square-foot corporate campus from Hewlett-Packard for $42.2-million, or $35 a square foot.

“The price paid by the two-year community-college system was about $100-million less than the number discussed a little more than a year earlier with Lone Star, according to a person familiar with the transaction. ‘We saw it as a grand opportunity to snatch up a beautiful campus for considerably less than its value,’ says Richard Carpenter, chancellor of Lone Star, which serves a suburban swath of the northwestern Houston region. ‘This is what the economy did for us.’”

The Journal says the deal is the second-largest U.S. office transaction of the year so far. And the college needs the room, apparently: Enrollment has grown 40 percent in the past five years.