Land Play Drives Office Buy

PHOENIX-Deals taking place so far in December include Banner Health’s 13,400-square-foot medical office building acquisition for a future land play. The area health care system paid $2.9 million for the fully-leased asset, which will have a brief future producing income before being torn down for a parking lot.

“Banner bought this because they’ve been trying to assemble land to build a new medical building. The hospital is right there and Banner owns other buildings around there,” explains Gordon Raguse, senior vice president with Grubb & Ellis/BRE Commercial LLC’s Phoenix office. Raguse represented seller 9th Street Tropical Building LLC, which is one of the practitioners in the medical office building at 1515 N. 9th St. The building is less than a block down the street from the Banner Good Samaritan Medical Center at 1111 E. McDowell Rd.

Raguse tells GlobeSt.com the off-market deal came about when Banner approached the building owner with a proposal that included a five-year lease-back and termination rights after three years. Banner was represented in the transaction by Steve Corney with Jones Lang LaSalle’s Phoenix office.