Office building sells for almost $20 million

Virginia-Urology-exterior

Virginia Urology’s building at 9105 Stony Point Drive. (Photo by Burl Rolett)

An out-of-town REIT has struck a big-money office deal in Richmond.

New York-based American Realty Capital Healthcare Trust bought the Virginia Urology Center building at Stony Point for $19.2 million. The building changed hands Monday, according to city records, in one of the biggest real estate acquisitions of the year within Richmond city limits.

The 53,000-square-foot office building at 9105 Stony Point Drive is 100 percent leased to Virginia Urology. The health-care firm is signed on for a 15-year term that will expire in August 2018, according an American Realty SEC filing. The same filing states that the property brings in an estimated $1.3 million in rental income annually.

Longtime local developer Bob Atack said medical office buildings are an attractive buy because they often come with long-term tenants that need specialized buildings suited to their work.

“You can’t just move into any office – you have to have those offices built to suit,” Atack said. “It’s a very good investment, because the tenants are very predictable, long-term tenants.”

Virginia Urology has occupied the building since its construction in 2003. The medical practice has four consecutive five-year lease renewal options on the building once its lease expires about five years from now.

The property sits on 5.44 acres just east of Stony Point Fashion Park and is assessed at almost $8.7 million.

American Realty purchased the building from Montecito Medical – Stony Point, LLC. The Stony Point property was part of an 11-building package known as the LaSalle Portfolio that was sold to American Realty for more than $107 million, according to an SEC filing.

The Stony Point property was previously owned by Montecito Medical Operating Company, a California-based REIT, but Montecito principal Chris Conk said the firm sold it to Jones Lang LaSalle a couple of years ago.

American Realty chief financial officer Brian Block did not return a phone message by press time.

American Realty’s purchase is the second biggest Richmond office deal in 2013, according to city records. The largest was the sale of MeadWestvaco’s downtown headquarters to Select Income REIT for $143.6 million.

Cushman & Wakefield | Thalhimer broker David Smith said there is strong interest in Class A medical office buildings, and he expects that trend to continue. He attributed part of that momentum to a desire from health-care providers to move services to more accessible locations away from the traditional hospital campuses.

“Typically the bigger medical office buildings have always been on or very close to a hospital campus,” he said. “That will continue, but we’ll also see a trend for continued away-from-the campus-type [medical office] development.”

Virginia-Urology-exterior

Virginia Urology’s building at 9105 Stony Point Drive. (Photo by Burl Rolett)

An out-of-town REIT has struck a big-money office deal in Richmond.

New York-based American Realty Capital Healthcare Trust bought the Virginia Urology Center building at Stony Point for $19.2 million. The building changed hands Monday, according to city records, in one of the biggest real estate acquisitions of the year within Richmond city limits.

The 53,000-square-foot office building at 9105 Stony Point Drive is 100 percent leased to Virginia Urology. The health-care firm is signed on for a 15-year term that will expire in August 2018, according an American Realty SEC filing. The same filing states that the property brings in an estimated $1.3 million in rental income annually.

Longtime local developer Bob Atack said medical office buildings are an attractive buy because they often come with long-term tenants that need specialized buildings suited to their work.

“You can’t just move into any office – you have to have those offices built to suit,” Atack said. “It’s a very good investment, because the tenants are very predictable, long-term tenants.”

Virginia Urology has occupied the building since its construction in 2003. The medical practice has four consecutive five-year lease renewal options on the building once its lease expires about five years from now.

The property sits on 5.44 acres just east of Stony Point Fashion Park and is assessed at almost $8.7 million.

American Realty purchased the building from Montecito Medical – Stony Point, LLC. The Stony Point property was part of an 11-building package known as the LaSalle Portfolio that was sold to American Realty for more than $107 million, according to an SEC filing.

The Stony Point property was previously owned by Montecito Medical Operating Company, a California-based REIT, but Montecito principal Chris Conk said the firm sold it to Jones Lang LaSalle a couple of years ago.

American Realty chief financial officer Brian Block did not return a phone message by press time.

American Realty’s purchase is the second biggest Richmond office deal in 2013, according to city records. The largest was the sale of MeadWestvaco’s downtown headquarters to Select Income REIT for $143.6 million.

Cushman & Wakefield | Thalhimer broker David Smith said there is strong interest in Class A medical office buildings, and he expects that trend to continue. He attributed part of that momentum to a desire from health-care providers to move services to more accessible locations away from the traditional hospital campuses.

“Typically the bigger medical office buildings have always been on or very close to a hospital campus,” he said. “That will continue, but we’ll also see a trend for continued away-from-the campus-type [medical office] development.”

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