SCOTTSDALE, AZ-In a simultaneous acquisition/disposition, Lowe Enterprises Real Estate Group of Los Angeles and Stamford, CT-based GE Real Estate have acquired a 711,381-sf, $144.5 million portfolio. Immediately on the heels of the buy, the JV flipped close to a quarter of it to BlackRock Realty Advisors of New York, NY.

BlackRock now owns the 190,702-sf Gainey Ranch Financial Center at 7377 E Doubletree Ranch Rd. The Lowe/GE joint venture retains ownership and in the 269,091 SF Paradise Valley Office Park at 11811 N. Tatum Blvd. in Phoenix and the 251,588 SF Scottsdale Executive Office Park at 7975 N. Hayden Rd. and 8655 E. Via de Ventura in Scottsdale. The group is planning $1.4 million in upgrades.

“One of the three assets was a core property that fit another investor’s criteria better than ours,” explains Kent Merselis, senior vice president of Lowe Group’s Arizona office. “They’d been a competing bidder and had introduced themselves to us as a potential buyer, should we be successful in the bidding process.” With the JV’s success in the acquisition, “BlackRock was willing to step up and pay us a premium,” Merselis says, declining to elaborate on what BlackRock paid for the facility.

But he does tell GlobeSt.com that the transaction is only the tip of the iceberg for future investments. “We’re looking at more deals every day,” he says. “We’re trying to increase our portfolio in value-add properties.”

With an average occupancy of 82% and an age of 20-plus years, the portfolio provides a perfect investment vehicle for the partnership. “We’re looking for quality properties that are experiencing below-market occupancy levels or properties that, for whatever their reason, are in need of capital expenditure,” Merselis tells GlobeSt.com. “We can then put a marketing focus team in there to lease them up.”

“Though this wasn’t our initial transaction with GE, it was significant,” Merselis adds. “It cemented the relationship and encouraged both sides to increase our portfolio.”

He adds that Lowe will handle leasing and property management for the facilities. Timi Anyon Hallem of the law firm of Manatt, Phelps & Phillips LLP’s Los Angeles office did the legal work for the JV. In the original sale to the JV, Dennis Desmond of Trammel Crow Co.’s Phoenix office brokered the deal for Gainey Ranch Financial LP.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

Dig Deeper

 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.