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Griffin Capital Essential Asset REIT Acquires McKesson Scottsdale Campus

April 16, 2018

Griffin Capital Essential Asset REIT Acquires McKesson Scottsdale Campus

April 13, 2018 | James Sprow | Blue Vault

Griffin Capital Company, LLC announced today, on behalf of Griffin Capital Essential Asset REIT, Inc. (the “REIT”), the acquisition of the McKesson Scottsdale Campus consisting of two, two-story, Class A office buildings, at a purchase price of $67.0 million from Ryan Companies US, Inc.

The property was owned and developed by Ryan Companies US, Inc. as a build-to-suit for McKesson Corporation, which leased the property for an initial term of approximately 10 years, expiring on February 28, 2028.

According to the Company’s press release, the property is an ideal fit for the REIT’s portfolio for the following reasons:

Industry-leading tenant: McKesson Corporation is a global leader in the healthcare industry and currently ranks fifth on the Fortune 500 List.
Class A build-to-suit property: The 271,085 square foot office property was completed at the end of 2017 to McKesson’s specifications and is a critical operating asset.
Prime location: The Property is centrally located between Scottsdale and Tempe, with immediate access to the 101 loop, allowing convenient travel for McKesson’s employees.

 

Commenting on the acquisition, Louis Sohn, Griffin Capital’s Managing Director of Acquisitions, stated, “We are pleased to acquire this newly-built facility leased to a leading global healthcare company with over 150 years of operating history and $199 billion in revenue in 2017.  The property provides a unique opportunity to acquire a long-term leased asset situated on one of the last remaining commercially developable parcels in the in-fill South Scottsdale Submarket.”

Michael J. Escalante, Griffin Capital’s Chief Investment Officer, added, “We are very familiar with the Phoenix MSA and believe we acquired a well-located asset at an attractive basis, due to its ideal location, which not only offers access to numerous retail amenities and the Greater Phoenix Area, but a diverse and skilled labor force, as well.”

The McKesson Scottsdale Campus is the third property to be acquired with 1031 exchange proceeds from the disposition of DreamWorks Animation’s Headquarters and Studio Campus, which the REIT sold on November 21, 2017, for $290 million.

Blue Vault’s Q4 2017 NTR report on Griffin Capital Essential Asset REIT reports the Company as of December 31, 2017, had a real estate portfolio, consisting of 73 properties, encompassing approximately 18.2 million rentable square feet in 20 states and 81 lessees consisting substantially of office, warehouse, and manufacturing facilities and 2 land parcels held for future development with a combined acquisition value of approximately $2.8 billion.

The Company’s distribution yield was 6.75% annualized based upon the original offering price of $10.00 per share.

On October 24, 2017, the board of directors approved an estimated value per share of common stock of $10.04.

Sources: Press Release April 12, 2018, by Griffin Capital and Blue Vault Partners

 

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