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GILBERT, AZ-Hudson Realty Capital LLC, in partnership with Biltmore Holdings LLC, has gained control of 13 acres from a local private seller. The partners plan to build 122,000 sf of retail and office space in an as-yet unnamed development with an all-in cost of $15.2 million to $15.8 million.

Hudson Realty, based in New York City, and the Scottsdale, AZ-based Biltmore Holdings will break ground at Power and Guadalupe Roads within six months. Karim M. Demirdache, managing director of Hudson Realty Capital, estimates build-out time will take about one year.

Demirdache tells GlobeSt.com that the master plan involves approximately 100,000 sf of office condo space and 22,000 sf of retail. Preliminary development plans focus on two retail buildings at 11,000 sf each and six two-story office buildings ranging from 6,200 sf to 13,500 sf.

Hudson is likely to keep and lease the retail component. “Right now, we’re looking at a couple of potential options for the retail,” Demirdache says.

The Hudson Realty-Biltmore partnership based its decision on the development strategy because of submarket activity. Demirdache points out that a lot of rooftops are springing up west of the project while more residential and retail development was occurring to the east. “We didn’t see much retail in the immediate vicinity and definitely not as many opportunities for condo office,” he explains. “That was one of the compelling things about the site, that there wasn’t much around it.” The seller of record is Gilbert Waterfront LLC.

The land purchase closely trails the partnership’s $10.4-million purchase of a vacant call center at 1951 N. Alma School Rd. in Chandler. Demirdache says he hopes to repeat the same success that the joint venture had a year ago with the sale of the Countrywide Home Loans Inc. building at 1330 W. Southern Blvd., but he’s also realistic.

“We underwrite our things conservatively. We assume it will be vacant for a year, then have a three- or four-year hold,” Demirdache explains. “Should we do better or exceed our expectations that would change, but we wouldn’t underwrite anything any more aggressively.”

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