Farmers Insurance Cuts $18M Sale-Leaseback

Steven M. Brabant, first vice president in Phoenix for CB Richard Ellis, Way Commercial Realty of Newport Beach, CA will upgrade the class B office space at 18444 N. 25th Ave. and put two empty floors in the four-story main building on the lease market. "The building was physically in very good shape, but they'll update the façade and bring it out of the 1980s for a more modern look," he says. Under the sale-leaseback, Farmers is taking half of the larger building and all of a 5,070-sf sister building, a 10-acre build-to-suit campus in the 1980s for the insurance company.

Brabant teamed with CBRE first vice presidents Richard W. Abraham, Robert L. Young and Glenn Smigiel and senior vice president Ashley A. Brooks Jr. to represent the seller. Brooks and CBRE sales associate Kelley Gulliver and first vice president Jim Bayless will lease the asset while Wilson Property Services Inc. of Phoenix will manage it.

Brabant tells GlobeSt.com that the deal awhile to close because Farmers needed to determine how much space it planned to lease back. He says Farmers at one point thought it would only need one floor of the building, but ultimately determined two floors would be necessary.

Brabant points out that Bruce Way of Way Commercial was the favored buyer out of many bids because of the ability to perform a quick due diligence. It's also well versed with the insurance industry, having recently acquired other real estate assets from insurance companies. TriSail Capital Corp. of Los Angeles provided mezzanine financing for the acquisition.

Way Commercial is gaining an asset in a well-traveled area of Interstate 17, which is home to many corporate users. "This is in area that appeals to a lot of people because of its location and easy access to the freeway and many levels of housing," Brabant adds.