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BANNOCKBURN, IL-Wells Real Estate Funds, based in Norcross, GA, has acquired Bannockburn Lake III, a 106,495-sf building at 2355 Waukegan Rd. Wells acquired the property from Denver-based Broe Real Estate. The sales price was $20.2 million, according to a Sept. 11 Form 8-K filing with the Securities and Exchange Commission.

A cap rate was not disclosed. The acquisition is for Wells Real Estate Investment Trust II and was funded with proceeds raised from Well’s public offering and proceeds from Well’s $400-million line of credit with Wachovia Bank, according to the SEC filing.

The three-story office building was constructed in 1987 and is currently fully leased to TAP Pharmaceutical Products, a joint venture of Abbott Laboratories and Japan-based Takeda Pharmaceuticals. TAP’s lease is until 2013. TAP develops pharmaceutical products and had a net worth, as of June 30, of $366.4 million, according to Well’s SEC filing. The asking lease rate for similar buildings in the area is about $14 per sf triple net, says Peter Mitchell, VP of Midwest acquisitions for Wells. Bannockburn Lake III, which is on a 10.2-acre parcel with trees and ponds, is one of five buildings in the Bannockburn Office Park. Keystone acquired three of the buildings at 2201-2333 Waukegan Rd. from GE Real Estate in July, as GE acquired the suburban portion of the Blackstone Group’s portfolio.

Broe had acquired the Bannockburn Lake III property in July 2006, according to a press release at the time from the company. Broe reportedly acquired the property for $13.4 million. The property interested Wells because it is well-leased and “we think it is well located,” being near I-94 and slightly north of I-294, Mitchell says.

The purchase of Bannockburn Lake III is the sixth Chicagoland acquisition for the real estate investment trust, Mitchell says. Wells has acquired 64 buildings in 20 states, including Washington, DC, for Wells REIT II with a total acquisition price of more than $3 billion. The properties in the portfolio have an average lease rate of 98%.

Most of the Chicagoland properties in the portfolio are in the I-88 corridor. The last Chicagoland acquisition for the REIT was the purchase in July 2006 of an office building, fully leased by OfficeMax, Mitchell says. The 354,000-sf office building, at 263 Shuman Blvd. in Naperville, IL, was acquired for $55.3 million, according to a SEC filing.

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