W.P. Carey Group Buys College Campus for $28M

The eight-story building has a total of 179,490 sf. The buyer received a $17 million first mortgage with a term of 140 months and a 7% fixed interest rate, sources say. The lender is reportedly UNUM Life Insurance Co. of America, based in Chattanooga, TN. Kendall College has a "long-term" lease for the building and "it is fair to say, generally, our leases are in the 20-year range," a spokesman for W.P. Carey Group says. There is some retail, geared to the school, on the first floor, Barthmaier says. There are approximately 1,350 undergraduate and graduate students that attend the college's culinary, global business, hospitality and education classes. The first year's rent is reportedly about $2.4 million.

The building was constructed in 1908 and renovated in 1999. The college acquired the building in 2003 for approximately $37 million, sources say. However, the sales price reportedly included a $19-million payment from Sara Lee to buy-out its lease for the property. The college renovated the former Sara Lee building, which has several wireless classrooms, a dining room and office space. Laureate will retain ownership of a parcel of land adjacent to the property.

Laureate recently acquired Kendall College and decided to sell the facility. W.P. Carey was interested in the property, in part, because it has experience in buying and owning for-profit educational facilities, Barthmaier tells GlobeSt.com. The company also owns properties occupied by Lincoln Technical Institute, Career Education Corp. and Universal Technical Institute, she says. "Laureate is unique because they have a large international focus, which represents a very attractive growth opportunity," Barthmaier says. Kendall College also has a good culinary education reputation and the property is "a great asset in a great location (being) so close to the heart of Downtown," she says.