A fully leased Downtown office building has traded hands for more than twice its assessed value.
309 Monroe Property LLC purchased the 22,792-square-foot property at 309 Monroe Ave. for $3.3 million. The Shelby County Assessor of Property’s 2011 appraisal was $1.5 million.
Brian Califf and Hank Martin with NAI Saig Co. represented the seller, 309 Monroe LLC, in the transaction. 309 Monroe LLC is an entity of Farnsworth Holdings.
The building is 100 percent occupied by the Social Security Administration Office of Disability Adjudication and Review. The property has a 15-year lease to the government with seven years remaining, which made it appealing to the buyer, Califf said.
“The buyers bought it as an investment property based on a cap rate,” Califf said. “So that’s why it sold for that.”
The Virginia-based buyer was put together specifically to acquire government buildings, said Michael Mullis, Farnsworth Holdings principal. The Memphis property is one of several the group has closed on recently.
“Government leases right now are as good of credit as you’re going to get,” Mullis said. “Buyers will typically pay more for better credit deals.”
• In other commercial leasing news, ProTech Systems Group Inc. has expanded by 1,004 square feet in Highwood Properties Inc.’s Shadow Creek I building, 3350 Player’s Club Parkway, suite 120.
The deal brings the local technology solutions company’s total square footage to 11,286 square feet.
Tony Argiro, director of leasing with Raleigh, N.C.-based Highwoods, represented the landlord and was the only agent involved in the deal.
Tenant expansions are always positive encouragement, given the economic circumstances, Argiro said.
“From our perspective, we are not receiving the same volume of calls from our customers wanting to discuss either reworking a lease or downsizing a suite – what has been referred to as shadow space. You know it’s dark, they’re not using it, but they’re kind of riding out a lease – those calls have slowed down,” Argiro said. “It started really about halfway through last year and it’s continuing into 2012.”
Similarly, Mid-South Geothermal LLC expanded by 577 square feet in Southwind Office Center B, 8725 Tournament Drive, suite 185. The new lease brings the local renewable energy company’s presence to 2,351 square feet in the complex.
Argirio represented the landlord.
And FedEx Trade Networks Inc. has relocated and expanded its headquarters in Crescent Center, 6075 Poplar Ave. The international freight forwarding servicer is expanding its existing space by 5,172 square feet and moving from the fourth to the third floor. The deal brings the FedEx Corp. subsidiary’s footprint to 24,834 square feet.
“This will allow them to have a suite that’s more fitting for a division headquarters, and at the same time, will allow them to have a very efficient layout,” said Argiro, who represented the landlord.
Wyatt Aiken, chief operating officer and executive vice president of Cushman & Wakefield/Commercial Advisors LLC, represented FedEx Trade Networks.
• Meanwhile, Palmer Brothers Inc. has signed a pair of new retail leases in recent weeks.
New Life Church of Memphis has inked a five-year lease in a 7,500-square-foot space in 1770 Dexter Spring Loop, in the building previously occupied by Golden Gate Cathedral and Tennessee state government.
Marvin Palmer, president and CEO of Palmer Brothers, handled the transaction for both the tenant and the landlord.
New Life Church of Memphis, which has about 50 members in its congregation, is relocating from Midtown. The non-denominational church is aiming for a Sunday, April 1, opening, in time for Palm Sunday, said the Rev. Melvin Miller.
“We wanted to come out to what I call open space and open sky,” Miller said. “I live in Cordova myself and felt like there was a need for a non-denominational church here. It’s what the Lord was leading us to. Sometimes you can’t put your finger on what you did and why, but you felt there was a need to do it. We feel like we will be a good help for the community at large.”
And Little Persia, doing business as Kabob International, has inked a 3,500-square-foot space at 8050 Dexter Road.
Marvin Palmer represented both sides in the three-year lease.
The Mediterranean restaurant, owned by Mansour Ash and his wife, Sharzad Kiani, has been located in the shopping center since its inception eight years ago at suite 105, and will relocate to a space twice its size in unit 101. Ash said the expansion will allow Kabob to be full-service, with seating up to 150, and expand its product offerings. The new unit also has a patio.
“Sometimes our customers would come and we wouldn’t have enough seats, so we’ll be able to serve better, faster and provide more options,” Ash said. “You usually don’t see Mediterranean restaurants serve beer and wine, but we’re going to start serving it.”