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SCOTTSDALE, AZ-A private investor from Southern California has plowed 1031 exchange gains from the recent sale of an apartment complex in the region into the $13.3-million acquisition of El Presidio at Pinnacle Peak, a 58,212-sf office property.

The Atlanta-based Pinnacle Peak Gardens LLC sold the property at 8700 E. Vista Bonita to San Diego County Medical Buildings LLC, led by Dr. David Smith. The transaction marks a return for Smith as an office building owner in the Phoenix area.

“Dr. Smith had purchased a 160-unit apartment building out here two years ago as well as one in Austin (TX),” Bret Zinn with Colliers International Inc.’s Phoenix office tells GlobeSt.com. “When he sold the apartments here, he couldn’t find anything in the multifamily area that made sense to him so he decided to go back and do what he did best, which is office buildings.” Zinn and Colliers’ Cindy Cooke represented Smith while Stan Shafer and Gordon Raguse with Grubb & Ellis/BRE Commercial LLC’s Phoenix office brokered on the seller’s behalf.

Zinn says El Presidio was everything that the buyer wanted. “The building is just a couple of years old; it’s in great shape. The cap rate worked for him and there are lots of long-term tenants,” he says.

The building’s occupancy pushed 95% at the time of closing. Peter Nieman of Colliers International’s Phoenix office is leasing the asset.

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