I-10 at 24th
Phoenix, AZ
This 80,000 square foot development was purchased out of bankruptcy in 2006. The five building complex consisted of a 40,000 square foot office building and 4 freestanding flex/industrial buildings. Urban Capital believed value would be maximized by separating the buildings so that they could be sold or leased for income. Only 30% leased at the time of acquisition, many of those existing leases were not renewed and an extensive renovation was completed.
Rather than go through a lengthy lot splitting (subdivision) process, a commercial condominium was created. The declining real estate market in Phoenix necessitated the sale of some of the buildings intended to be held for cash flow.
As of July 2008, 4 of 5 buildings have been sold, retiring the entire interim loan and returning invested capital. Upon sale of the last building (which is free and clear), equity is expected to have significantly increased.