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NOVI, MI-Construction has begun on Phase I on Keystone Medical Building, a 60,000-sf, $11.5 million medical office property that will provide equity participation to tenants who agree to a 10-year lease minimum of at least 3,500 sf.

Located at 46325 W. 12 Mile Rd. on 12 acres of land, the building is slated for completion during the late summer of 2006. The asking lease rate is $21.50 per sf, triple-net, plus a TI allowance of $50 per sf.

“We have one lease officially signed, and we’ll be closing soon on a few others–that will bring us up to about 50% pre-leased,” says Scott Marcus, principal with RSM Development & Management in Bloomfield, MI, which owns and is developing the project. Marcus tells GlobeSt.com that Phase II of the project, a 45,000-sf property to be built on the same plot of land, will be scheduled when Phase I is 100% leased.

“What we’re basically saying here is come in, be a good tenant, sign a 10-year deal and you get free ownership,” Marcus says. Eric Banks and Bob Moon at Friedman Real Estate Group, based in Farmington Hills, MI are handling leasing activities for the property.

Marcus notes that this particular equity buy-in isn’t very common, though a few business properties have offered condos for sale. But with Novi becoming a hot spot for residential development, physicians and other health care providers are following the trend–and are demanding space. In addition, Providence Hospital has secured permission to break ground on a new facility in the area as well.

“This is the beginning of it,” Marcus predicts. “Over the next two years, there will be a major shift of doctors to where the primary facilities are located, and Novi is becoming one of those sites.”

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