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$5M High Bid Takes Fitness Center

GILBERT, AZ-A San Jose, CA investor brings his money east to buy the 25,500-sf Mountainside Fitness Center at 725 W. Warner Rd. The deal closes with an 8.8% cap rate to a first-time metro buyer.

By Lee Simmons | Updated on June 04, 2004

GILBERT, AZ-A San Jose, CA, investor has inked a $4.5-million purchase of the Mountainside Fitness building in Gilbert, capitalizing on a healthy cap rate and long-term tenant. The deal marks yet another in a wave of Golden State investors in search of lower cap rates and stabilized retail assets in Maricopa County.

“He was basically looking for a single-tenant deal, a good cash flow situation and this fit him perfectly. He was very aggressive on the terms,” Ari Spiro, a senior investment advisor at Sperry Van Ness in Phoenix, tells GlobeSt.com. The 25,500-sf building, located on 3.5 acres at 725 W. Warner Rd., stood on the market for two months before the seller gave the nod to Jeff Gordon of San Jose, who placed the highest bid out of six. Escrow lasted two months to close at 1% below the asking price at an 8.8% cap rate, says Spiro.

Gordon obtained an acquisition loan from Ventura, CA-based Affinity Bank at a 70% loan-to-value ratio to make good on the deal. It is his first acquisition in the Phoenix market.

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