94 Hundred Shea Sells For $16,327,500

Vizzda – May 3, 2013 – Talia Jevon Properties of Vancouver, BC, has acquired 94 Hundred Shea, an Office & Retail mixed-use development in Scottsdale, from LNR Partners of Miami, Fl, for $16,327,500 or $220.40 per ft2.  

94 Hundred Shea is a 74,079 ft2 office and retail complex located east of the southeast corner of Loop 101 and Shea at 9325, 9343, 9375, and 9397 East Shea Blvd in Scottsdale. It is comprised of a 38,840 ft2 2-story office component and three multi-tenant retail strip buildings built in 2007 on 10.62 acres zoned C-3. The property has ±440 parking spaces or 5.9 spaces per 1,000 ft2.   

This property was previously acquired by John Rosso & Steven Goodhue of the now-defunct Westar Development on May 31 2002 as ±18.2 acres of vacant land for $8,287,726 or $10.5 per ft2 with $5,887,726 down; loaned $2.4m debt with Stearns Bank. Westar sold off a portion of the land and developed the remainder into 94 Hundred Shea. On May 18, 2007 Westar encumbered the property with a $21.0m loan with Canadian Imperial Bank of Commerce. 

This debt was securitized as commercial mortgage backed securities (CMBS)  by JPMorgan Chase Bank in 2007. The underwriter’s appraisal of July 1, 2007 described the property as 72,621 ft2 and 78.7% occupied with an appraised value of $31.0m. That loan was described in the SEC package as as a 6.02937% net rate maturing June 1, 2017. 

On October 6, 2010 the property was noticed for trustee sale on $21m orig debt in the care of LNR Partners as special servicer, cancelled December 10, 2010.  The property was re-noticed for trustee sale on February 1, 2012 reverting through trustee sale to LNR Partners on May 17, 2012 for $23.4m credit bid amount.

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By:

Edward Moore
Director of Research
www.vizzda.com

Bank Sale of Proposed Mixed Use Project in Tempe

Johnson Bank has sold a 3.46 gross acre lot in Tempe that is platted for Dorsey Crossing Live/Work Townhomes, a 45-townhome mixed use project. The lot was purchased by New Leaf Communities for $750,000 or $2 per square foot, $350,000 down, and $400,000 debt with Bill Cleverly of Inca Capital. The project has previously been marketed as 1233 Off Broadway, located at 1233 E Broadway Rd, East of the southeast corner of Rural and Broadway Roads. 

The project was previously acquired as land only on April 24th, 2006 for $800,000 or 5.01 per square foot, and $1,050,000 debt with IMH Financial corp; the note was later released in 2007. In 2006, the site went through the entitlement process with the City of Tempe planning and zoning to establish a planned area development for the mixed-use project, atop its PCC-2 zoning designation. New debt of $2,761,000 with Johnson Bank was issued July 26th, 2007. Johnson Bank gave notice of trustees sale September 30th, 2010. Johnson Bank then foreclosed on the property on December 30th, 2010 for $1,263,000 credit bid amount.

According to Vizzda’s analysis of city zoning documents from a March 26th, 2006 project approval with the City of Tempe, the entire project is composed of three phases on 8.55 acres. The fist two phases are already built and the subject property (phase III) is on 3.46 gross acres (2.55 net), and will total 87,425 sf of total building area in 9 different product types. The 45 three-story buildings will consist of 45 residential units (7 two bedroom, 38 three bedroom). 14 of the units will have ground floor commercial space, ranging from 321 to 571 square feet. The buildings have a maximum allowable height of 40 feet and the density is measured at 17.6 dueling units per acre.

BY

Daniel Alpers

Director of Planning & Municipal Solutions

Tempe Grove Apartments Purchased by Fairfield Residential

VIZZDA – September 5, 2012 –  a 408-unit apartment complex at 909 W Grove Parkway in Tempe was sold by Archstone Apartments for $39.5m or $96,813 per door. The deal recorded August 31st, 2012 with $400k down per affidavit and a $29.625M Freddie Mac Multifamily Loan, maturing 9/1/22, originated through CBRE Capital Markets.  The three and four story apartment complex consists of 17 buildings built in 1998 on 20.17 acres zoned R-4. The brokers, Cliff David and Steve Gebing of Marcus and Millichap, report ±$3M in capital improvements since Archstone acquired the property in 2006. Asking price on the May 31st, 2012 broker flyer was $42.0M.  See the broker flyer here.

The apartments feature one, two and three-bedroom apartments and two and three bedroom townhomes. The brokers’ pro forma indicates that the apartments are 95% occupied. The apartments’ unit mix–taken from the linked flyer–is reproduced here:

The apartments were developed by Jay Wilton of Wilton Partners of Los Angeles who acquired the 20.17 acre parcel of vacant land for $1.63M or $1.85 per square foot, no debt recorded with sale.  Wilton Partners recorded a $871K related debt  on the property May 21st, 1996 by which the principles of Wilton Partners loaned themselves these funds. This debt was released September 4th, 1996.  Wilton Partners also borrowed $1.15M from Bank One August 2nd, 1996, released March 17th, 1998. 

However, the critical debt history on the property began August 29th, 1997 when Wilton Partners acquired a $24.588M note with TRI Capital Corp (6.5% APR, maturing January 1st, 2039) with a US Department of Housing and Urban Development (HUD) agreement binding the property with leasing restrictions requiring an absolute preference in leasing to displaced persons or families per section 221(d)(4) of the National Housing Act. 

This debt was modified June 22nd, 2001, increasing outstanding principle to $25.99M. On July 24th, 2004 TRI Capital assigned debt to Midland Loan Servicing who immediately re-assigned to HUD.  On April 5th, 2005 HUD released the property from any leasing restrictions and sold the note to a Delaware corporation including Archon Group.  On July 31st, 2006, Wilton Partners returned the property to Ameriton Properties, the capital arm of Archstone-Smith, through Deed-in-Lieu. On October 5th, 2007, Archstone-Smith was acquired by a Tishman Speyer and Lehman Brothers FSB partnership – this ownership entity was rebranded as “Archstone” February 19th, 2008. 

Richard L Boynton (VP) of Fairfield Residential and Brett C Johnson (VP) of Archstone closed the deal.

Links:

By:

Edward Moore
Director of Research

Agave Center Sold to Westport Capital Partners for $23.3m

VIZZDA–August 15th, 2012 — Multi-Employer Property Trust (MEPT) a commercial real estate equity fund representing several local trade unions and administered by David Keto of Newmark Trust Company has sold several lots of a partially developed office/retail mixed use complex for $23.3m. Riggs and Company acquired the 22.37 acre original assemblage in a partnership with the trustee for MEPT on May 24th, 1999 for $4,552,350. The $23.3m sales price represents a 412% appreciation gross of fees and development costs or a 31% annualized rate of return.

The portion conveying consists of five 1 and 2-story buildings totaling 218,993 SF built in 1999 on 16.99 acres, as well as 4.64 acres of undeveloped land zoned PCC-1. Marc Porosoff in his capacity as Principal and General Councel was signatory for Westport Capital Partners. This acquisition–when combined with the Pinnacle Peak Business Park (124k SF) and the Scottsdale Financial Center II (150k SF)–marks the third large acquisition by Westport Capital Partners in the Phoenix area.

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BY:

Paul Dionne

Director of Anayltics