MIG Real Estate Buys Scottsdale Centre for $21M

SCOTTSDALE, AZ-MIG Real Estate has acquired its first office property in the Phoenix metro area. The Newport Beach, CA-based buyer paid $20.8 million for Scottsdale Centre, a 164,000-square-foot, class A- building located at 7373 N. Scottsdale Rd. Los Angeles-based Arden Realty Inc. was the seller.

A local industry expert notes that MIG Real Estate acquired Scottsdale Centre at a significant discount to what Arden Realty paid in 2007. “Arden bought at the top of the market – paying more than $245 per square foot, and then making a significant investment in the property to make it competitive with the rest of the market,” the expert says, adding that MIG Real Estate paid roughly $127 per square foot – about half of what Arden paid.

The 1980s-era property, which was 46.3% occupied at closing, received 26 offers, according to Brian Ackerman, senior vice president of Jones Lang LaSalle’s Phoenix office. He and Dennis Desmond, also with Jones Lang LaSalle, brokered the deal.

“If this deal had been marketed a year ago, the interest would have been totally different,” Ackerman tells GlobeSt.com. “We would have been dealing with maybe a handful of investors that would be interested.”

Ackerman says the strong investor interest reflects the market’s long-term potential. “Investors believe in the story of the Phoenix market – that it’s reached bottom,” he notes, adding that MIG Real Estate was one of the “more aggressive groups from the very beginning in terms of expressing interest.”

MIG Real Estate paid cash for Scottsdale Centre, which recently received $5.2 million worth of improvements including common area remodels, three new staircases, exterior paint enhancements, parking garage improvements and energy efficient lighting. “The prestigious Scottsdale location, complemented by extensive improvements and modernizations, provides us with exceptional upside potential for Scottsdale Centre,” says Greg Merage, CEO of MIG Real Estate.