Cole Grabs University of Phoenix Complex
In what is being called one of Arizona’s largest single-tenant office transactions ever, Cole Real Estate Investments snapped up the 600,000-square-foot University of Phoenix office complex in Phoenix’s Riverpoint neighborhood. Apollo Group Inc.’s $170 million sale-leaseback deal with Cole broke the state record and benefits its commercial real estate market, according to industry experts.
“A real estate transaction of this size and magnitude shows that transactions are happening within the state, and that’s always a good thing,” said Robert Micera, Cole’s chief investment officer for office and industrial property. “It’s a nice fit when you have two local companies like Cole and Apollo Group making a transaction,” he added.
Occupying 37 acres, the build-to-suit property--which includes two six-story structures, one 10-story building, and two parking facilities--was completed in 2007. The University of Phoenix will continue to maintain the $121 million Riverpoint headquarters under a 20-year, triple-net lease agreement with Cole.
The acquisition of the property boosts Cole’s presence in Arizona’s commercial real estate market to approximately 2 million square feet of space, much of which consists of single-tenant retail space. The company, which has already closed $300 million in acquisitions this year, has an additional $800 million in deals in the pipeline and a goal of $3 billion in transactions for 2011.
“As it combs the country for premier opportunities, the company is not looking to take on a lot of debt,” said John Bacon, vice president of marketing at Cole. “We leverage our properties conservatively--and we tend to pay cash,” Micera noted.