(Read more on the TIC market.)

LAS VEGAS-Two buildings totaling 101,000 sf in the Siena Office Park here changed hands earlier this month for approximately $42 million, according to Clark County records. Known as Building Three and Building Five, the buildings were developed in 2002 and 2003 by Plise Development and Construction. Major tenants include HQ Global Workplaces Inc., National University and Countrywide Home Loan. Overall occupancy is currently 91%.

Located at 861 Coronado Center Dr. and 2850 W. Horizon Ridge Pkwy., Triple Net Properties acquired the two low-rise buildings on behalf of tenant-in-common investors. Triple Net chief investment officer Jeff Hanson says Triple Net initially took a significant position in the properties but has since sold additional stakes in the assets to additional 1031 exchange investors.

Siena Office Park is a 380,000-sf development that supports St. Rose Hospital and the business needs of the surrounding communities. Its buildings are home to physicians, dentists, outpatient treatment and imaging centers, laboratories and other professional offices. The buildings Triple Net acquired for its investors is one-third leased to medical-related tenants.

“We like that story; we’re big on medical,” Hanson tells GlobeSt.com. “We see those as real anchor tenants that will run with the property for a long time.”

The gross purchase price translates to $415.85 per sf, which would be the top of the market. However, the listing broker, Charles Moore of CB Richard Ellis, tells GlobeSt.com the actual purchase price was $35.75 million or about $340 per sf, which is a market price. The $42-million price recorded with the county includes $6 million or so in fees related to the tenant-in-common transaction.

“Office rents are going up,” Moore says. “So if cap rates remain stable, we will be talking about other deals in the $400-per-sf range.”

While this is considered a core asset, there is room the add value to the property. “There’s upside through rolling below market rents to market and leasing up the remaining available space,” Hanson says. “The Vegas rental market is moving so fast…”

Of the 40 properties that Triple Net has taken full circle in the past six years, the average hold period was 3.1 years. Hanson says Triple Net has been a net seller in the Las Vegas market over the last four-to-five years due to cap rate compression, but the company continues to seek out opportunities.

Triple Net Properties, a sponsor of funds, REITs and TICs, is a wholly-owned subsidiary of NNN Realty Advisors Inc., a nationwide commercial real estate asset management and services firm that is being merged into Grubb & Ellis. The transaction is scheduled to close in the third or fourth quarter.

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