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SUN CITY, AZ-A private investor from Manhattan Beach, CA has picked up Sun City Professional Building after it fell out of escrow. The first-time Valley buyer has paid $1.4 million for the 15,788-sf, class C office building.

Sold by the Perisic family of nearby Gilbert, Sun City Professional Building sits on more than an acre at 12630 N. 103rd Ave. It is 91% occupied by 27 national and local tenants, including Farmers Insurance, Comfort Keepers, Statewide Hearing and Loveland Tax & Financial. “The Perisic family wanted to sell the building because it was too management intensive with so many tenants,” Sean Stutzman, an investment adviser with Sperry Van Ness’ Phoenix office, tells GlobeSt.com.

Stutzman says the number of tenants and the 40-year-old construction were obstacles although the listing reeled in 10 offers. “Having that many tenants is unusual and it scared away buyers,” he explains. “The buyer saw it as an opportunity because of the diversity of tenants–the thought is that they could easily be replaced.”

Stutzman says Sun City Professional Building provides strong cash flow with little upside. The property, which has an average lease rate of $13 per sf, traded at an 8.7% cap rate, according to the broker, who teamed with Ari Spiro, Jeff Chalfin and Mike Day to steer the sale. Scott R. Trevey of Phoenix-based RE/Max Commercial Investment represented the buyer.

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