Warner Crossings Pair Brings About $23M

TEMPE, AZ-A pair of fully leased back-office buildings in Warner Crossings Business Park has changed hands for nearly $23 million. The new owner is starting out the hold with a tenant roster of publicly traded companies with no lease rolls until 2008.

International Capital Partners, headquartered in Scottsdale, has acquired 8260 and 8312 Warner Crossings from a Minneapolis-based limited liability company. International Capital made the close with a $17.3-million, five-year loan from Artesia Mortgage Capital Corp. of Issaquah, WA.

"International Capital bought it at below market rents," Brad Miner, associate with CBRE/Melody in Phoenix, tells GlobeSt.com. "And, they all roll within the five-year term. With the renewal option, they'll bring rents back up to market."

Miner says the loan closed in roughly 45 days. "It was a straight-forward deal," he says, adding Artesia previously had sized up the asset so it was relatively smooth sailing from the application point. "It was shopped around. There was definitely interest," he stresses, "but Artesia had the best offer." The end result is a fixed rate and interest-only payments.

A 67,234-sf building is fully occupied by a hardware group of Honeywell Corp., which has a 70-acre corporate campus abut one mile to the west. A 75,240-sf structure holds the headquarters of TSYS Acquiring Solutions and the Arizona central operations center for the Birmingham, AL-based Compass Bancshares Inc. The structures, built in 1999 and 2000, sit on a 15-acre tract.

The terms on the triple net leases is "maybe the only real challenge," says Miner, a member of CBRE/Melody senior director Rocco Mandala's team, which marked its 22nd financing for International Capital with the Warner Crossings purchase. TSYS' lease comes due in 2008 and the other two are up for renewal in 2009. It could create a "cash-flow sweep" if they opt not to renew, but the deal has a built-in reserve safeguard, Miner adds.