Mark-Taylor and Kitchell Sell Chandler Apartments for $65m

By: Paul Dionne | Vizzda.com

A joint-venture between developers Mark-Taylor and Kitchell has completed the sale of the ParcLand Crossing apartment complex in Chandler for $65m or nearly $170k per door. The joint venture was formed in 2011 when an entity formed by Mark-Taylor and an affiliate of Kitchell Development Company acquired the parcel as raw land for $4.25m from Kitchell proper. The buyers were Seattle-based multi-family investors PrivatePortfolio Group, who put $23m down on the property and financed the remainder of the purchase price with $42m in new debt with Sun Life Assurance of Canada

The 383-unit apartment complex is comprised of twenty three 3-story residential buildings totaling 367,312 ft² and five ancillary structures totaling 8,171 ft² including a 4,711 ft² clubhouse. The complex sits on a 20.84 acre site east of the southeast corner of Alma School Road and the Loop 202 San Tan Freeway and was delivered to the market in 2012. The gated community features two resort-style pools and amenities including in-unit laundry facilities and a fitness center.

Kitchell began acquiring land in the vicinity in 2006: picking up an adjoining parcel for $4,722,720 with $3.6m purchase money debt with JP Morgan Chase. The subject parcel was acquired in early 2007 for $6,203,038 and a Joint Development Agreement with the City of Chandler for the larger assemblage was entered into in May of that year. Following a debt modification in July which increased the balance on the JP Morgan note to $8m, the adjoining property was sold to Lauth Property Group for $10,433,569. As mentioned above, Mark-Taylor and Kitchell entered into a joint-venture in 2011, after which they encumbered the property with $36m in new construction debt with Wells Fargo.

To Contact the Author:

Paul Dionne - pdionne@vizzda.com

Two Golf Courses Change Hands for Eight Figures

VIZZDA—August 7^th, 2013 — FireRock Golf and Country Club in Fountain Hills and the Arizona Golf Resort in Mesa were sold last week for a combined price of $11.8m. Both of these assets pricing in the seven figure range is atypical for golf assets, which typically transact in the low six figure range. Though the circumstances of the transactions were quite different, high valuations for recreational assets such as golf courses and resorts bode well for the Phoenix-area real estate market.

The first of these properties to change hands was FireRock, a 7,001 yard, par-72 course designed by Gary Pank in 1999 and boasting a 2-story 29,058 ft² clubhouse. The sale price of $5.5m was furnished by the members of the club, who voted to buy out the original developers, MCO Properties, earlier this month. The vote was a response to professional golfer, Phil Mickelson, placing a bid on the property. More information on the circumstances of this sale can be found in this article from the Fountain Hills Times.

The Arizona Golf Resort is a 187-room golf resort with 54 condo units built in 1967 and renovated in 2004. The resort features an 18-hole, par-71 golf course that was completed in 1962. The property sits on roughly 120 acres at the southeast corner of Broadway and Power Roads. The $6.3m acquisition by Dr. Matthew Luxenberg represents a steep decline from a previous purchase price of $22.305m in April of 2007. Following default on a $19.2m CMBS note with JP Morgan Chase, the property reverted at trustee sale for $5,900,783 in August of 2010.

By:

Paul Dionne

Director of Analytics

Vizzda.com

MetLife Sells Scottsdale Shopping Center to Bob Parsons of GoDaddy

VIZZDA—July 26^th, 2013 — The McDowell Mountain Marketplace, an 88,121 ft² neighborhood shopping center at the southwest corner of Thompson Peak Parkway and Bell Road, sold for $14.125m or $160.29 per square foot. The seller was Metropolitan Life Insurance Company (MetLife) through its portfolio manager, Blackrock Realty Advisors. Bob Parsons, Executive Chairman of GoDaddy, purchased the property through his real estate holding company, YAM Management, in an all cash transaction.

MetLife had previously acquired the property from Canadian retail operator, Centrecorp, in February of 2006 for $22.5m or $255.33 per square foot with $11,633,379.18 down and the assumption of an existing $12.25m note with the Teachers Insurance and Annuity Association of America (TIAA). The $14.125m recent sales price represents a 37.22% decline in value over the seven-plus year holding period.

The complex is comprised of a 57,892 ft² anchor space, currently occupied by Basha’s on a 20-year firm term lease commencing on November 30^th, 2000 with four 5-year options to extend. There are two non-contiguous inline retail buildings totaling 26,288 ft² and a freestanding retail pad, which is ground-leased to JP Morgan Chase until November 30^th, 2022. The anchor and inline space was completed in 2002 and the pad space was added to the 10.9-acre site in 2007. Approximately 440 parking spaces convey for a parking ratio of 5.42 per 1000 ft².

By:

Paul Dionne

Director of Analytics

Vizzda.com

26-Story Phoenix Corporate Center Noticed For Trustee Sale, $54M

Phoenix Corporate Center - 3003 N. Central Avenue

VIZZDA – 6/14/2013- A Notice of Trustee Sale was recorded against a $54m face value note secured by  the 26-story Phoenix Corporate Center located at 3003 N Central Ave. The foreclosing beneficiary is ColFin PHX Tower Funding LLC—an entity formed by Colony Capital. Petrus Partners, in care of their local affiliate Crown West Realty is the trustor under the note.

Crown West Realty acquired the building on June 26^th, 2007 for $69.25M or $155.33 per rentable square foot. Krausz Companies—who had held the property since 1990—was the seller and JP Morgan Chase provided $54M in financing for the deal. JP Morgan assigned the note to Colony on December 19^th, 2012. Per a Colony Financial, Inc. 10-k:

In December 2012, we invested $16 million in a joint venture with Co-Investment Funds that acquired a sub-performing first mortgage loan secured by a high-rise office tower in a main metropolitan center located in Phoenix, Arizona. The loan was acquired for approximately 59% of its UPB of $54 million. Our share of this investment is 50%.

Located north of the northeast corner of Central Avenue & Thomas Road, the Phoenix Corporate Center was originally built in 1989. Owner’s describe the property as 445,811 RSF with a 17,095 ft² floor plate. The 4.31 acre site includes a 5-level above grade and 2-level sub-grade parking garage with 1,124 spaces. Amenities include ground-floor retail, 3,600 ft² fitness facility, and a 180-seat auditorium. The building has undergone several renovations of varying scope. The law firm, Fennemore Craig, was an anchor tenant in the building—occupying over 100k ft² of space for a time—dating back to 1994. The firm moved to the Biltmore area in April of 2013.

The Trustee for the note is Mr. Jonathan T Brohard of Polsinelli. Auction is presently scheduled for September 18^th, 2013 at 11AM.

For more information on this and all distressed property in Maricopa County, log in to Vizzda.com or contact Kris Thompson for a demonstration.

By:

Hadden Schifman

Managing Director

Vizzda.com

Camden Acquires San Marcos Apartments in Scottsdale

VIZZDA—December 19^th, 2012 — Camden Property Trust, through its General Counsel J. Robert Fisher, has acquired the San Marcos Apartments for $46.9m or 146,562.50 per door. Cydney White in her capacity as Senior Vice President served as signatory for the seller, Equity Residential.

The apartment complex is comprised of 320 individually metered units in nineteen 2 and 3-story buildings totaling 361,846 ft². It was built in 1995 on 16.92 acres zoned R-5 South of the Southeast corner of Loop 101 and Thunderbird Road in Scottsdale. The in-house property management for Camden reports 91.48% occupancy at time of sale.

Equity Residential acquired the property on November 1^st, 2006 for $51.21m or $160,031.25 per door. Following transfer to a related entity on March 14^th, 2008, Equity Residential encumbered the property with $32.9m cross-collateralized debt with Wachovia Multifamily Capital, assigned to Freddie Mac at origination and released with Tuesday’s sale.

Camden did not list a cash payment for the property and no debt was recorded with sale. That being said, on December 7^th, 2012 Camden issued $350m in 2.95% notes due 2022 to JP Morgan Chase, Merrill Lynch, U.S. Bancorp and Wells Fargo Securities as underwriters. This is the first of two major multifamily acquisitions by Camden in as many days, totaling $92.6m.

By:

Paul Dionne

Director of Analytics

Vizzda.com

Oaktree Capital Management President buys Fender Headquarters for $29.85m

--> VIZZDA—December 17th, 2012 — Bruce  Karsh of Oaktree Capital Management has purchased The FNBA Building in the Perimeter Center Business Park from WDP Partners. The building is the current headquarters for Fender Musical Instruments, and was formerly the headquarters for First National Bank of Arizona. 

The two-story office building is located West of the Southwest corner of Princess Road and Loop 101 at 17600 N Perimeter Drive in Scottsdale. Documents filed with the SEC list the building at 127,690 ft², though broker marketing materials place the structure at 137,000 ft². The property was built in 1999 on 10.39 acres zoned I-1. It has an approximate parking ratio of 5.26:1000 ft². Fender signed an 134-month lease (eleven years and two months) with two 5-year options to extend for 110,875 ft² on September 9th, 2011. The rents and escalations are as follows:

Months	Annual Basic Rent per RSF
0-14	0
15-98	23.80
99-134	24.5

Fender Filed an S-1 Registration declaring their intent to issue shares to the public on March 8th, 2012 with JP Morgan Chase as lead underwriter. An amended S-1 was filed on July 10th, 2012 detailing a $200m maximum amount raised on 10,714,286 shares issued, including 3,571,429 shares from Michael Lazarus, principal of Weston Presidio. Fender withdrew it's registration on August 8th, 2012.

Oaktree acquired the property for $29.85m or $277.33 per ft²; they paid $12.35m in cash, and secured $17.5m new debt with JP Morgan Chase maturing January 1st, 2023. First National Bank of Arizona (FNBA) previously acquired the property on May 1st, 2003 as 16.64 acres of vacant land for $19.484m or $142.22 per ft² and $19.6m new debt with California Bank and Trust; Metros Credit Card Services was a sub-lessee at the time.

FNBA refinanced the property several times, including $14.5m in new debt issued April 28th, 2005 with Countrywide, maturing May 8th, 2015 and having a 5.56% interest rate. This note was securitized September 1st, 2005, and assigned to Wells Fargo Bank CMBS. The $19.6m original note was released May 11th, 2005. FNBA merged with First National Bank of Nevada (FNBN) June 30th, 2008 prior to the closure of FNBN by the FDIC on July 28th, 2008. 

A court order appointing a receiver to the property was approved and it was concurrently sold to WDP Partners on November 22nd, 2010 for $10m or $72.99 per ft. While the amount down was not listed on the affidavit, WDP Partners secured $5,460,000 new debt at 18% interest with National Bank of Arizona. The $29.85m sales price represents a 99.25% annualized rate of return for WDP Partners.

By:

Daniel Alpers

Director of Planning and Municipal Solutions

Paul Dionne
Director of Analytics
Vizzda.com