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North Scottsdale Office Site Sells for $16M

SCOTTSDALE, AZ-In back-to-back transactions the North Scottsdale Gateway office building was bought, flipped at a $2.5-million profit and a lease signed by the seller to cap off a double escrow deal between United Insurance Co. and WKL LLC.

By Lee Simmons | Updated on April 20, 2004

SCOTTSDALE-Chicago-based United Insurance Co. of America has purchased the North Scottsdale Gateway office building for about $15.8 million from WKL LLC, a partnership formed by Erik Lutz and Fred Kron of Great Southwest Mortgage. The double escrow deal netted $2.5 million for Lutz and Kron in one day.

“They bought it as a user, signed a lease and sold it with their lease in place,” Steve Kohls, an associate in the office properties division of Phoenix-based Lee & Associates Arizona, tells GlobeSt.com. “It’s a creative deal.”

Lutz and Kron initially purchased the building from North Scottsdale Gateway LLC and Byxbee Development Partners for about $13.3 million. They signed a seven-year lease on behalf of Phoenix-based Great Southwest Mortgage, of which they are principals, for the third floor of the 80,468-sf building. They then sold the building with their lease intact to United Insurance, Kohls says.

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