$65M Construction Loan Seeds 260,000-SF Spec

The developer will deliver one building in March 2010 and bring the second one on line eight months later. The project will include about 16,000 sf of retail.

Michael Hurst, vice president of Newport, Beach, CA-based Buchanan Street Partners, says the Los Angeles-based developer, who bought the land in 2005, plans to sell most of the 90 acres to other developers for hospitality, retail and office projects, but has retained 20 acres for its own use. Hurst, who arranged debt and equity financing, says Cyburt Hall Partners' land is located at the junction of San Tan Freeway/State Highway 101 and Price Road.

"The purpose of this financing was to recapitalize out of their land development and into a new partnership that will finance the bricks and mortar for their office and retail," Hurst tells GlobeSt.com. The joint venture equity partner is National Electric Benefit Fund, while debt is being provided by Bank of America Corp. in Charlotte, NC.

Hurst is mum about the financing details, but acknowledges that obtaining financing for the project was a challenge, given the current capital market, local housing crisis and fear of overbuilding. Adding to the problem is the speculative nature of the development.

However, the project's location and Cyburt Hall Partners' development expertise helped ease the way. Hurst points out Price Road is home to many corporate campuses, including Intel Corp., Wells Fargo & Co., Motorola Inc., Toyota Finance Corp., Charles Schwab Corp. and Orbital Sciences Corp. Hurst says the campuses require auxiliary businesses like legal, accounting and other professional services and Park Place Office Center is geared to those businesses.

"The City of Chandler has been thoughtful in the way they've created a sustainable employment base along the Price Road corridor," Hurst says. "There are about 25,000 jobs crammed into a two-mile stretch."