Tanenbaum Equity Partners (TEP), a Dallas-based commercial real estate investment firm specializing in government-leased properties, has completed a recapitalization of TEP Government Holdings, its nationwide portfolio of 98 properties, resulting in a total portfolio value of approximately $450 million. The transaction combines senior debt from Centennial Bank, a preferred equity investment from Eagle Point Credit Management, and existing common equity controlled by TEP’s principals.
The recapitalization establishes a consolidated capital structure for a portfolio spanning approximately 1.6 million square feet across 24 states, with properties leased primarily to 30 federal government agencies. TEP intends to use the new structure to improve operational efficiency, support cash flow, and provide additional flexibility for future acquisitions.
The portfolio has an occupancy rate of 98% and a weighted average remaining lease term of 5.2 years, reflecting its concentration in properties occupied by federal government tenants.
By consolidating multiple property-level financing arrangements into a unified structure, TEP aims to simplify its financing operations and establish a more efficient framework for managing and expanding its real estate holdings.
The transaction also brings together two institutional financing partners with complementary roles. Centennial Bank is providing the senior debt component, while Eagle Point is contributing preferred equity. TEP’s principals will retain control of the existing common equity.
The $450 million figure represents the approximate value of the recapitalized portfolio, rather than the amount of new debt or equity raised. The company did not disclose the individual financing amounts, interest rates, or other detailed financial terms.
The transaction follows more than a decade of investment in government-leased real estate by TEP, which has developed one of the country’s largest privately owned portfolios focused on federally leased properties.
Government-leased real estate represents a specialized segment of the commercial property market, with buildings occupied by government agencies performing administrative, operational, and other public-sector functions.
The sector can offer distinctive investment characteristics because federal government tenants generally have strong credit profiles and frequently require facilities tailored to their operational requirements.
Properties leased to government agencies may also benefit from established tenant relationships and opportunities for lease renewals, although individual assets remain subject to occupancy, renewal, financing, and other real estate investment risks.
TEP’s acquisition strategy focuses on identifying government-leased properties that can generate recurring rental income while providing opportunities for long-term ownership and portfolio expansion.
The company’s existing portfolio includes buildings occupied by approximately 30 federal agencies, providing exposure to multiple government tenants across geographically diverse markets.
With properties located in 24 states, TEP has established a nationwide operating platform rather than concentrating its investments in a single metropolitan area or region.
Its 98% occupancy rate indicates that nearly all available space in the portfolio is currently leased.
The portfolio’s weighted average remaining lease term of 5.2 years provides visibility into its existing lease commitments while allowing TEP to pursue renewals and manage individual property performance.
The recapitalization is intended to strengthen this operating platform by replacing multiple financing arrangements with a consolidated structure that can support portfolio-level capital allocation and future acquisitions.
The transaction also represents an important development for Sunny Sajnani, CEO of Tanenbaum Equity Partners, who is overseeing the firm’s next phase of expansion.
Under Sajnani’s leadership, TEP intends to continue acquiring government-leased properties while applying its existing asset management capabilities to maintain occupancy, manage lease renewals, and support long-term property performance.
TEP’s management team also includes Becky Tanenbaum Mallace, Chief Operating Officer, who helps oversee the firm’s operating strategy and government-leased real estate portfolio.
The firm’s investment approach draws on the broader real estate experience of Chairman Richard Tanenbaum, whose career spans more than 35 years across commercial real estate investment, development, and ownership.
Since 1997, Tanenbaum has overseen the expansion of the affiliated Gardner Tanenbaum commercial real estate portfolio from approximately 800,000 square feet to more than 8 million square feet.
During that period, he has completed nearly 50 real estate projects representing more than $1 billion in development activity, spanning multifamily, industrial, retail, and office properties.
That experience has informed TEP’s approach to developing a specialized real estate investment platform centered on government tenants and long-term property ownership.
TEP is an affiliate of Gardner Tanenbaum Holdings, an Oklahoma City-based real estate investment and development company primarily focused on multifamily and industrial properties.
The recapitalization also expands TEP’s institutional financing relationships through its partnership with Eagle Point Credit Management.
Eagle Point manages approximately $14 billion in assets on behalf of institutional and retail investors and employs more than 120 professionals.
The investment manager specializes in private credit opportunities across markets including portfolio debt securities, regulatory capital relief transactions, infrastructure credit, strategic credit, specialty finance, and collateralized loan obligation securities.
Its preferred equity investment provides an additional layer of capital within TEP Government Holdings’ financing structure, alongside Centennial Bank’s senior debt and the common equity retained by TEP’s principals.
TEP plans to use the financial and operational flexibility established through the transaction to pursue additional government-leased property acquisitions while continuing to manage its existing portfolio.
The company will remain responsible for acquisitions, asset management, and investor relations for TEP Government Holdings following the recapitalization.
Raymond James served as exclusive financial advisor to TEP on the transaction, drawing on its real estate investment banking capabilities in capital raising, recapitalizations, mergers and acquisitions, and other strategic transactions.
KEY QUOTES:
“Over the last decade, we’ve built one of the nation’s largest privately owned portfolios of federally leased real estate. This recapitalization establishes a long-term capital structure that reflects the quality and stability of our assets while creating a strong foundation for the next phase of our acquisition strategy. We’re proud to partner with Centennial Bank and Eagle Point as we continue to expand our platform.”
Sunny Sajnani, CEO of Tanenbaum Equity Partners
“I’ve spent my career focused on building real estate platforms that can perform through changing market cycles, and this transaction reflects that same long-term philosophy. What the TEP team has built in the government-leased sector is exceptional. This recapitalization validates the strength of the portfolio and gives us the flexibility to continue growing it thoughtfully for the next generation.”
Richard Tanenbaum, Chairman of Tanenbaum Equity Partners
“Government-leased real estate offers durable cash flows and attractive risk-adjusted characteristics. TEP has assembled a high-quality portfolio that aligns well with our investment strategy, and we’re pleased to support the platform’s next stage of growth.”
Jaime Milgram, Vice President at Eagle Point
“Federal agencies continue to rely on specialized facilities owned by the private sector, creating durable demand for well-located government-leased assets. Through disciplined acquisitions, proactive asset management, and a strong lease renewal track record, we’ve built a portfolio designed for long-term performance. This recapitalization positions us to continue executing that strategy for years to come.”
Becky Tanenbaum Mallace, COO of Tanenbaum Equity Partners
