Week In Review - July 18th, 2014

Newly Built Phoenix Apartment Complex Sold for $35.4m

Less than six months after a certificate of substantial completion was recorded against the property—indicating that the property was fully constructed and ready for occupants—Avenue 25 Apartments in Phoenix sold for $35.4m or nearly $140k per unit. The buyer was TruAmerica, in the person of its CFO, Karen Millan, who paid $10.62m in cash and financed the remaining $24.78m in purchase price with Capital One.

First Four Parcels of Crescent Ridge Acquired for $21.6m

Jeff Blandford of Blandford Homes as acquired 128.76 acres of unimproved land at the northeast corner of Guadalupe and Crismon Roads in Mesa comprising parcels one through four of the five parcel, 172.5 acre Crescent Ridge master-planned community. The $21,623,412 purchase price for 552 final platted lots equates to $167,934 per acre, $39,173 per planned lot or $830 per planned front foot. 

Midtown Niki and Pederson Acquire Bella Angela Shopping Center

In a pair of consecutive sales, a joint venture between San Diego-based Midtown Niki Group (MNG) and the locally-based Pederson Group purchased four single-tenant and two multi-tenant retail buildings for a combined $7.92m or $187.60 per square foot. The single-tenant portion was acquired with $5.712m down and the multi-tenant portion was acquired with $300k down, both parcels were encumbered under respective $1.62m seller-carry notes

Alliance’s Broadstone Camelback Sold for $74.75m

The Broadstone Apartments are located in Phoenix’s prized Biltmore corridor, directly South of the Biltmore Fashion Park at 2625 E Camelback Road. Alliance constructed 270 units on the site in 4-story buildings, consisting of: 53 studio, 110 one bedroom, and 107 two bedroom--some of which are marketed as penthouses.  The community is  presently marketed as rentals, restricted from condominium conversion through 2022.

Midtown Niki and Pederson Acquire Bella Angela Shopping Center

By: Paul Dionne | Vizzda 

In a pair of consecutive sales, a joint venture between San Diego-based Midtown Niki Group (MNG) and the locally-based Pederson Group purchased four single-tenant and two multi-tenant retail buildings for a combined $7.92m or $187.60 per square foot. The single-tenant portion was acquired with $5.712m down and the multi-tenant portion was acquired with $300k down, both parcels were encumbered under respective $1.62m seller-carry notes for a total cash tender of $6.012m and total new debt of $3.24m.

The Bella Angela shopping center totals 42,216 ft² in six 1-story buildings built from 1999 to 2001 on a 7.02 acre site east of the northeast corner of Bell Road and SR-51 in Phoenix. There are two multi-tenant buildings demised into twelve spaces totaling 18,715 ft². The single tenant spaces are comprised of a freestanding Walgreens Pharmacy at 14,060 ft², two pads occupied by Jack in the Box and KFC at 2,660 and 2,340 ft², respectively, and a full service restaurant space occupied by a Village Inn at 4,441 ft².

The Walgreens operates under a ground lease that is slated to expire on October 14^th, 2048. The Jack-In-The-Box space is leased until April 11^th, 2019 and the Village Inn space is leased until October 25^th, 2019; both Jack-In-The-Box and Village Inn have two 5-year options to extend their lease. The terms of the KFC lease were not publicly disclosed, nor were the terms of a cell phone tower lease encumbering the property. The multi-tenant spaces with publicly-recorded lease terms operate under leases that expire between October 31^st, 2014 and January 16^th, 2017. 

The deal was structured such that the multi-tenant properties were conveyed to a special purpose entity with both MNG and Pederson as members and the single-tenant properties were conveyed to that same special purpose entity and three additional MNG affiliates as tenants-in-common. The stake in the single-tenant properties attributable to the joint venture including MNG and Pederson is 8% with the three MNG affiliates taking down the remaining 92% as undivided 45%, 36% and 11% interests.  Pederson will act as property manager for the shopping center, while all of the financing materials are in care of Midtown Niki Group. 

To Contact the Author:

Paul Dionne – pdionne@vizzda.com