ATLANTA-A bank-owned office property in Duluth has sold for pennies on the dollar. An undisclosed CMBS special servicer sold 11450 Technology Circle to a private investment partnership for $4.3 million.
Jay O’Meara, senior vice president, Will Yowell, vice chairman, and Justin Parsonnet, executive vice president of CB Richard Ellis’ Atlanta Institutional Group, represented the seller. CB Richard Ellis declined to disclose the buyer at press time, but will be handling the leasing and management for the firm.
“This is a special use building,” O’Meara tells GlobeSt.com. “It was built for a specific tenant for a specific purpose. But it can be converted, whether it’s for single use or multiple tenants. It’s well located with quality build-outs and upgrades and state-of-the-art technology and fiber.
11450 Technology Circle is a 143,000-square-foot single-tenant office building, located in Johns Creek in Duluth. The REO asset was formerly the headquarters for Arris, a communications technology company. Arris vacated the property in 2004.
“The building is empty,” O’Meara says. “The tenant moved out before the lease expired and the owner had a non-recourse CMBS loan. The owner exercised the option to return ownership back to the servicer and they foreclosed on it. The market has a strong appetite for REO deals like this one.”
O’Meara says what set this deal apart from other REOs in the market was its especially low price. At $4.3 million, he calls it a “cheap” sale even after plenty of would-be buyers bid aggressively on the vacant asset. Atlanta has the second highest office vacancy rate in the nation and more than 20 percent of the city's office space is empty, according to Cushman & Wakefield.
“There’s always a risk when you buy a vacant building,” O’Meara says. “You have to be confident that you can lease it up. The investors who bid and the subsequent buyer were confident they can lease it.”
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