PHOENIX—Lee & Associates Arizona has closed on the three-office building leasehold sale of Papago Arroyo, 1255, 1275 and 1295 E. Washington St. in Phoenix for $40.85 million.
Combined, the buildings total 279,503 square feet, which calculates to $146.15 per square foot. The cap rate was reported to be 7% based on first year NOI performance.
Lee & Associates' Coppola-Cheney Group and Jerry Marrell, principal, negotiated the sale along with Bob Young and Glenn Smigiel of CBRE. The buyer was Papago Arroyo Associates, LLC of Honolulu. The seller was Greenwood & McKenzie RE Investments, of Tustin, CA.
“Papago Arroyo is part of the story that keeps getting better in Tempe. Located along the light rail system, this three-building campus is only minutes away from Phoenix Sky Harbor Airport, three major freeways and Arizona State University, which will always make it attractive to tenants,” said Andrew Cheney. “The new development underway in Tempe only adds to this property's upside.”
The stable, class A project is situated on a ground lease with 68 years remaining. The highly-sought after location has driven leasing demand for the remaining space. It is currently at 96% leased. The buildings were developed in 1998 are situated on the Tempe/ Phoenix border. The property offers 5 per 1,000 ratio of parking, close access to major freeways, light rail stations and Phoenix Sky Harbor International Airport.
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