SCOTTSDALE, AZ-A little more than two years after WDP Partners LLC acquired the vacant former headquarters of the First National Bank of Arizona (FNBA), the Phoenix-based investor sold the office building, with Fender Musical Instruments Group as its main tenant, to Bruce Karsh, head of Oaktree Capital Management in California. The buyer paid $29.8 million for the 127,750-square-foot building, which is Fender’s headquarters.
“They’d held it for more than a year and leased it up,” explains Jim Fijan in CBRE’s Phoenix office, who represented the seller of the office building at 17600 N. Perimeter Dr. “It seemed like a good time to get it to the market place.”
Fijan tells GlobeSt.com that, once the property hit the market, it didn’t even get to the bid process. “We had 75 people requesting information on the building,” he says. Ultimately Karsh was willing to move quickly and put up a significant non-refundable deposit. “You could say he pre-empted the sales process,” Fijan says.
For Fijan, the transaction is what he dubs a “hat trick” – he sold the building to WDP in 2010, found Fender as a tenant in 2011 (the musical instrument company has a five-year lease in its space) and engineered the marketing and sale of the property in late 2012. He explains that Fender has the majority of the space; another tenant leases 16,000 square feet. ”We found the right tenant with Fender,” he comments. “The building has an atrium that fit into how they wanted the space to look. They display their wares there – it almost looks like a museum.”
The story was much different in November, 2010. At that time, the building was vacant, with former tenant FNBA having merged with the First National Bank of Nevada, which was, in turn, shut down by the Federal Deposit Insurance Corp. in 2008. Fijan says the long-term plan was to find a larger tenant, which is what happened. Furthermore, as part of the lease with Fender, many of the building’s systems were improved and updated.
“This was a great deal for all concerned,” Fijan observes. “It’s not often you have the opportunity to sell a vacant building to an investor, lease it up, and then sell it for him after a brief period of time. And Bruce is happy with it. He loves the tenant.”