American Furniture Warehouse Buys 40 Acres in Glendale for $9m

Vizzda – July 23, 2013 –  A 41.49 acre parcel in Glendale located at the southwest corner of Loop 101 and Bethany Home Rd, opposite of Westgate City Center and City of Phoenix Stadium and previously planned for a 1.25m square foot, mixed-use project called “Bella Villagio,” has been sold by Stearns Bank to American Furniture Warehouse for $9.0m or $4.98 per square foot.

The prior owners–doing business as Stadium Holdings LLC–previously acquired this land from the Arizona Department of Transportation on November 16, 2007 for $16.265m or $9.00 per square foot with $15.8m debt with Stearns Bank. The property was noticed for trustee sale November 26th, 2008 on the outstanding debt with Stearns. Stadium Holdings LLC filed for Chapter 11 Bankruptcy and Stearns Bank secured a ruling lifting the automatic stay on foreclosure on January 26th, 2010. The property then reverted to Stearns Bank on February 12, 2010 through trustee sale process for $16.495m credit bid amount.

Vizzda is actively researching the zoning and planned development for the site, which at this point appears to be in the early stages.

Edward Moore

Director of Research

emoore@vizzda.com

www.vizzda.com

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Cigna Corporate Campus at Norterra Sold to Griffin Capital for $54.5m

VIZZDA—June 20th, 2013 — John Post of USAA Real Estate Company has completed the sale of the 232,648 ft2 Cigna Corporate Campus at Norterra to Griffin Capital for $54.5m or $234.26 per square foot. Griffin Capital—under the direction of Joseph Miller, its Chief Financial Officer—paid $6.2m in cash and encumbered the property under an existing $400m cross-collateralized deed of trust with Key Bank.

USAA Real Estate Company acquired a 127.83-acre parcel a portion of which comprises the land on which the project sits on January 5th, 2000 for $6.05m, representing $47,328 per acre and $1.08 per square foot prices. A 16.48 parcel was conveyed to an affiliate of USAA for $1,415,264 on may 3rd, 2000 and the complex was delivered to the market later that same year. The fully leased complex is comprised of two 3-story buildings of 116,324 ft2 each and two 4-story parking structures totaling 223,584 ft2.

The northern building of the complex, which is located north of the northeast corner of I-17 and Happy Valley Road, has been triple-net leased to Cigna Medical Group form October 1st, 2010 and Cigna leased space in the southern building commencing October 1st, 2011. The Cigna lease, comprising 100% of the rentable square feet of the complex was assigned to Griffin Capital at the time of sale, though their remaining term and any options to extend or terminate were not recorded.

By:

Paul Dionne

Director of Analytics

Vizzda.com

Parkway Properties Assumes Majority Interest in US Airways Headquarters

US Airways CenterVIZZDA—June 6th, 2013 — An ownership group comprised of W.P. Carey & US Airways sold a 74.58% interest in the US Airways Building at 111 W Rio Salado Parkway in Tempe to Parkway Properties for $41.765m. In conjunction with its acquisition, Parkway issued $13,944,746 in new debt to the entity controlled by W.P. Carey and US Airways. The sale price is reflective of a March 15th, 2013 agreement valuing the property at $56M. According to a previously released prospectus by Parkway Properties:  

The office building is the headquarters for US Airways, which has leased 100% of the building through 2024 with a current in place net rent of $17.50. US Airways has a termination option on December 31, 2016 and December 31, 2021 with 12 months prior notice. US Airways is also the owner of the remaining approximate 25% interest in the building and has a right of first refusal that allows it to purchase the interest that we intend to purchase for a period of 30 days after receipt of formal notice of the proposed transaction… Full text found here.

The 218,000 ft2 9-story building west of the southwest corner of Mill Avenue and Rio Salado Parkway was built-to-suit US Airways’ predecessor in 1999. It sits on 3.73 acres, zoned CC and features a 655-space parking facility. The upper floors house executive management while 164,870 ft2 of the building services as a flight center, providing logistical and operational support for US Airways. The building was awarded LEED Gold in 2009 and received EnergyStar ratings from 2000 to 2012.

From the earliest stages of planning, the Government Property Lease Excise Tax (GPLET) sale-leaseback structure was utilized to promote the development of the site. In this instance, America West Airlines initiated a sale-leaseback of an 80% undivided interest in the property to the current seller on February 26th, 1998 for $3.05m. W.P. Carry and America West Airlines executed a 15-year lease, commencing May 1st, 1999 and expiring in 2024. Further insight into GPLET can be found here.

The GPLET incentive was realized as the tenant-in-common stakeholders sold their ownership interests to the city of Tempe and leased the property back. The lease term was for 8 years, scheduled to end July 30th, 2008, but instead expiring on June 25th, 2007 per a termination option. At that point, ownership reverted back to tenant in common ownership structure with different percentage interests; WP Carey 75.58% and America West Airlines to 25.42%. America West Airlines and US Airways merged in 2005 with the new company adopting the US Airways name and the America West Airlines headquarters. 

The remaining lease termination options are scheduled for December 31st, 2016 and December 31st, 2021. US Airways is currently in the process of merging with American Airlines.

By:

Daniel Alpers

Director of Planning & Municipal Projects


Hadden Schifman

Managing Director


Paul Dionne

Director of Analytics

 

Vizzda.com 

ASM America Headquarters Building sells for $19,750,000

Vizzda – June 5, 2013 – The ASM America headquarters building sold yesterday for $19.75m or $151.59 per ft2 with $9.875m down and $9.875m new debt with US Bank. Winnipeg-based Artis REIT acquired the building from a tenant-in-common investor group headed by Robert F Caldwell of Caldwell’s San Francisco Door Company. Kirsty Stevens, chief administrative officer of Artis, closed the deal with Caldwell.

The ASM America headquarters building was developed by the Douglas Allred Company as “Allred 2,” one of five buildings in their Southbank development, and the building which won them the NAIOP “Build to Suit of the Year Award” for 1997. The building is located north of the northwest corner of Universtity and the I-10 at 3420 & 3440 E University Dr. This is a 132,282 ft2 R&D building, broadly classified as industrial / office, with a ±40,000 ft2 second story office mezzanine component. The building has a clean room and is utilized by ASM for high tech semiconductor research. The warehouse component of the building has 30’ clear height and three truckwells. The site includes 426 parking spaces for an overall 3.27:1000 parking ratio.

Robert F Caldwell, et al acquired the building from Douglas Allred Company on October 4, 2001 for $15.45m or $118.59 per ft2 with $100k down and the assumption of $11.36m debt with The Manufacturer’s Life Insurance Company. The Douglas Allred Company had encumbered the property with $11.36m in debt on July 23, 2001 just a few months before the sale was recorded, a debt which the investor group assumed. The building has been 100% leased to ASM America since August 12, 1996.

Edward Moore
Director of Research

Griffin Capital REIT Acquires the Avnet Integration Headquarters in Chandler

Vizzda – MAY 30TH, 2013 – Griffin Capital Essential Asset REIT, Inc has acquired the Avnet Integration headquarters in Chandler for $31.5M or $137 per square foot. There was a $500K down payment, and the property was secured under a $200M cross-collateralized note with Keybank.

The 229,740 ft2 distribution center is located at 6700 West Morelos Place in Chandler, east of the southeast corner of 56th Street and the Loop 202. The property consists of one building on 13.11 acres zoned with a planned area development overlay. The building consists of 183,061 ft2 first floor that is used for integration and logistics. The 46,679 ft2 second floor is strictly office space. Further information on this building’s features is available through a  subscription to Vizzda.

Ryan Companies developed the building built-to-suit in 2007 for Avnet Integration, whose lease commenced on January 10th, 2007. The site was later sold to FORT Property Management on July 25th, 2008 for $35.2M or $153 per square foot. Fort facilitated a tenancy-in-common ownership arrangement by selling off fractional interests from July 28th, 2008 through April 20th, 2010.

By: Daniel Alpers

Director of Planning & Municipal Projects

Vizzda.com

JDM Partners Acquires State Farm Operations Center in $73m Sale-Leaseback

VIZZDA—May 24th 2013 — Following its $14.2m acquisition of Warner Crossing Lot 3 earlier this month, JDM Partners has acquired Sunland at Fountainhead Corporate Park—also known as the Regional Operations Center for State Farm Auto—for $73m or $184.41 per square foot. JDM Partners Inc. paid $25.55m in cash for the property and secured an additional $47.54m in funding from Wells Fargo. As a condition of the sale, State Farm agreed to lease the property from JDM Partners for a period of ten years with two 5-year options to extend, commencing immediately. John Higgins, Senior Investment Officer for State Farm Mutual Automobile Insurance Co., and Mel Shultz of JDM Partners, Inc. were signatories to the deal.

The seven building complex north of the northwest corner of Priest Drive and Southern Avenue in Tempe is comprised of four 3-story office buildings totaling 353,967 ft2 and one 1-story warehouse with a 24’ clear totaling 42,867 ft2. The property also includes two above grade parking structures totaling 348,614 ft2. The built-to-suit complex was completed in 1999 at the behest of State Farm on 20.95 gross acres, zoned GID. State Farm acquired the property as approximately 46.35 acres with existing structures on May 5th, 2005 in a related transaction. State Farm sold a 25.4 acre portion of their original acquisition—including a 236,742 ft2 existing office building to First National Bank on April 30th, 2003 for $9.25m.

By:

Paul Dionne

Director of Analytics

Vizzda.com

Titanium Real Estate Advisors Purchases GSA-Leased Office in Glendale

VIZZDA—February 6th, 2013 — Doug Brown of Regent Properties has completed the sale of Lot 3 of the Glendale Corporate Center for $4.1m or $239.80 per square foot in an all-cash transaction. The buyer, Tom LaLonde of Titanium Real Estate Advisors, specializes in properties that are fully leased to the General Services Administration (GSA).

The 17,099 ft2 1-story office building is located north of the northwest corner of Loop 101 and Camelback Road in Glendale. It was originally developed by Opus West Corp. in 2007 as part of a six building complex on 22.25 acres zoned C-O. While the GSA stipulates 40 parking spaces for its use in the lease, roughly 55 parking spaces convey with the property for a parking ratio of 3.2 spaces per 1000 ft2.

Opus West previously acquired the land on which the complex sits from the Arizona Department of Transportation on December 29th, 2006. On January 7th, 2007 they received a $30.87m construction loan from Bank of the West secured by the land and future improvements. Following Opus’ default on that note, the property was noticed for trustee sale on May 14th, 2009 and reverted to Bank of the West as beneficiary on August 26th, 2009 with a $12,249,600 credit bid.

Regent acquired the entire complex for $9.205m on March 10th, 2010 in an all-cash transaction. On November 16th, 2011 the GSA initiated a 10-year full service lease of 16,632 rentable square feet which generates $441,229.61 in annual gross rent. The property is being used as a field office for the U.S. Marshals’ Violent Offender Task Force.

By:

Paul Dionne

Director of Analytics

Vizzda.com