Challenge

Granada Business Park is an eight (8) medical/professional office building campus in the geographic center of the Albuquerque MSA. The property consists of 118,782+ rentable square feet of office space with 4,500+ square feet of on-site storage. The Park is comprised of two (2) distinct products; Granada Square 2-2 Story Class B Office Buildings which were 87% leased and Granada Business Center 5 – 1 Story Class C Office buildings that were 71% leased. The challenge was the Class B portion of the project was a stabilized asset while the Class C product is at the end of its useful life. To compound the issue, at the time the Class C office market was over 30% vacant with vacancies continuing to increase and rental rates continue to search for a bottom.

Solutions

Position the asset as a Value-Add opportunity with the benefit of Granada Square having historically high and stable occupancy while Granada Business Center, though underutilized both in terms of ratio of building to land and use, provided positive cash flow while repositioning the asset for re-development for a higher a better use.

Results

The property was sold to a New Mexico Developer whose primary focus is retail. The Developer is in the planning phase for redevelopment phase of Granada Business Center to include retail pad site and getting ready to take Granada Square portion of the property back to market to sell as a separate asset.