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SCOTTSDALE, AZ-On a per sf basis, Pinnacle Peak Place has become one of the most expensive office buildings the state, with a private investor from California anteing up $5.6 million or $250 per sf for the 22,400-sf, class A, office building.

“Only a handful of other office buildings have sold for over $240 per sf in Arizona,” says Tracy Cartledge, a Phoenix broker for Dallas-based Trammell Crow Co., who represented the seller, Victoria Properties, a developer based in Victoria Island, BC. TCC’s Steve Lindley and Bob Buckley also represented Victoria Properties, which owns about one million sf of industrial and office properties in the Valley. The developer built Pinnacle Peak Place at 8525 E. Pinnacle Peak Rd. about five years ago.

Cartledge tells GlobeSt.com that Kurt Fisher of San Juan Bautista was one of six offers placed during a five-week marketing period for Pinnacle Peak Place. Most of the interest was from private investors. “Given the size of the assets, it appealed to 1031 Exchange buyers,” he says.

According to Cartledge, Pinnacle Peak has the highest rents in the entire Phoenix market, driving the value of the properties. Moreover, there are barriers to entry in North Scottsdale.

Pinnacle Peak Place is Fisher’s first acquisition in the Valley. He completed a 1031 Exchange out of a multifamily asset in Northern California to purchase the fully leased building. Tenants include Northern Trust Bank and Chicago Title.

Fisher assumed an existing loan with New York City-based Metropolitan Life Insurance Co. that is paid off in 2010. “The financing made the sale challenging…the buyer had to assume debt that was above current interest rates and low leverage of 50%,” Cartledge says. Henry Chazankin of Windsor, CA-based Chazankin Commercial Realty represented Fisher.

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