The property is located at 7000 Post Rd. FedEx is having a 90,000-square-foot ground transportation facility built for it on the property by McMahon Development, with which it has signed a 10-year lease. Construction is underway.
The purchase price works out to $18.53 per square foot. Local experts tell GlobeSt.com that the current market for land--not that it's trading these days--is no greater than $8 per square foot. Moreover, they say there's nothing special about the property that FedEx purchased.
"The going rate is half what they paid or less," says one local land expert. "They must have been over-a-barrel for some reason."
FedEx did not immediately respond to a request for comment. The seller was Post Rainbow LLC, an entity that includes Donny Borsack and Craig Michael of Nevada Building & Development Co. The seller's broker was David Frear of Colliers International.
Non-resort land as of the third quarter was valued at $5.18 per square foot, according to Applied Analysis, a local business research and advisory firm. This time last year, the average was $10- to $12 per square foot. The drop is due largely to distressed asset sale, Applied Analysis principal Brian Gordon tells GlobeSt.com. While the price FedEx paid appears to be well above even the average pricing from a year ago, Gordon says the purchase could have been appropriate for any number of reasons.
"Every property is unique and every buyer is in a unique situation," Gordon says.
Dan Doherty, who brokered the FedEx build-to-suit-to-lease deal for McMahon tells GlobeSt.com that the property was in escrow for 10 months and FedEx had been working to obtain all the necessary permits for the development of the property. Having to kill the deal and start over again may not have been something the company had time to do.
"You get to a certain point and you can't stop anymore," he says.
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