Some quick thinking by brokers saved the sale of a medical office building after one of its tenants unexpectedly closed its business just a week before the deal was slated to close.
Unity Medical Properties, based in Monterey, California, bought its first property in the Pacific Northwest, the 21,373-square-foot Valley River Medical Office building at 1400 Valley River Drive in Eugene, Oregon, from locally based Chvatal Orthodontics.
The Northmarq brokers were able to close the deal for just under $10 million — a record price of $463 per square foot — and negotiated a rent holdback reserve agreement that was acceptable to the buyer and seller after the tenant that had recently signed a five-year lease extension abruptly shut its doors.
Their persistence and creativity impressed the judges who are real estate professionals familiar with the market, earning the transaction a 2024 CoStar Impact Award.
About the deal: The buyer took out a $45 million loan from KeyBank National Association to finance the purchase.
What the judges said: "The brokers found a way to hold the sale together after a curve ball, and utilized creative thinking and negotiations to provide some confidence to the buyer," wrote Brian Fratzke, principal with Fratzke Commercial Real Estate Advisors.
"In a year with extraordinarily low sales volume, especially among office properties, this transaction points to the attractiveness of medical office for investors," added Colliers Research Analyst Jamison Shields.
They made it happen: Northmarq's Anthony Albrecht and Michael Kapnick represented the seller.
CoStar Market Manager Chris Sangiuliano contributed.