Web MD signed a five-year lease that commences in December. The negotiated lease rate came in about 5% under the published full-service asking rate of $19.50 per sf, according to local sources familiar with the deal. Web MD was represented by Eric Haskins of Grubb & Ellis, who could not be reached for comment.
The lease completes a nice turnaround for Montgomery Park, which is owned by Bill Naito Co. When the Naito family feud was settled out of court in January 2005 with a division of assets, vacancy at its Montgomery Park building was over 30% and some big leases were nearing expiration. By January 2006, two anchors (Freightliner and Wells Fargo) totaling 240,000 sf had been renewed and 90,000-sf of new leases (Zones Inc., World Travel, UPS, Schnitzer Steel) had been signed, dropping vacancy into the teens.
The rapid recovery allowed the property owners to close on a 10-year, $65-million refinancing at the end of November, which at the time represented 75% of the property's value. Since that time, World Travel and Schnitzer Steel have expanded their leaseholds in the building, Vidiom Systems leased about 10,000 sf and Web MD inked its 47,000-sf deal. CB Richard Ellis brokers Trevor Kafoury, Tom Fellman and Josh Schweitz have the leasing assignment for the building.
Montgomery Park and other real estate assets were previously held by H. Naito Corp., which included various members of the Naito family. A falling out prompted litigation that resulted in the out-of-court settlement that divided the assets between two shareholder groups. Sam Naito and his son Verne got the H. Naito Corp. name and the family's Made in Oregon chain of retail stores. All but two of the real estate assets went to the children of the late Bill Naito (Sam's brother) and Sam's two oldest sons (Ron and Larry), who sided with Bill's children in the dispute. They formed Bill Naito Co. to own the assets.
Shortly thereafter, locally based Elliott Associates was selected to manage the real estate assets after Bill Naito Co.'s board of directors--all family members at the time--inked a shareholder agreement that calls for an independent third-party provider to manage the assets and oversee day-to-day property management.
Continue Reading for Free
Register and gain access to:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
