Transactions

As long-term owners and managers of commercial real estate, our significant competitive advantage results from our appreciation of the value of the underlying assets involved in each transaction and our ability to structure each deal based on the unique circumstances facing each owner. For example:

Wolf Commerce Center
In a $7 million all-cash transaction (January, 2010), we acquired a 505,000-square-foot industrial property within the Washington DC Beltway from a lender pursuant to a foreclosure. The asset was formerly the distribution center and warehouse for a major, regional grocer. An investor purchased the asset when the grocer vacated; however, that investor was unable to reposition and lease the property and, consequently, defaulted on his loan. The property sat vacant for several years and its condition severely deteriorated. The transaction required Alliance to redefine the lot line pre-acquisition and to undertake a major redevelopment plan post-acquisition in order to reposition the property for leasing. Redevelopment included replacement of the roof, installation of new building systems, demolition of non-functional space, creation of a new fire corridor and interior layout, and refurbishment of truck courts. By July, 2011, we had leased 97,000 square feet of space.  The remaining space represents the largest block of available warehouse in the Greater Washington DC market and is actively being marketed for lease.

Lehigh Valley Distribution Center
In a $59 million transaction (May, 2010), we acquired a 490,000 square-foot, long-term net leased, single tenant, state-of-the-art corporate warehouse facility from a private equity investor seeking to close-out a legacy fund. The property is located in the Lehigh Valley region of Pennsylvania, a strategically located 48 million square-foot industrial distribution market serving the U.S. East Coast corridor. The lessee, a large international corporation, has deemed this special-use warehouse property to be excess corporate real estate, and we are working with the lessee to re-lease the asset. The transaction required that we assume an existing long-term CMBS loan; the assumption process included obtaining special servicer and rating agency approval . Our track record, reputation and experience expedited the assumption process.

Advocate Medical Center
We acquired the loan held by a bank on a newly constructed, 50% leased, 67,000-square-foot medical office building located in suburban Chicago (August, 2010). The loan was in maturity default. In order to meet an internal deadline of the seller, we expedited due diligence and closed all cash two weeks after contract execution. After closing, we entered into discussions with the capital provider and agreed to sell them the loan in January, 2011, resulting in a profitable disposition in only five months from acquisition.

Alliance Corporate Center
In a $16 million transaction (September, 2010), we acquired an 184,000-square-foot flex building in Woodbridge, Virginia, from tenancy-in-common (TIC) ownership under duress due to a hyper-amortizing CMBS loan. The acquisition process was uniquely difficult as we needed to convince 15 TIC owners to agree to the terms of the sale and execute the purchase and sale agreement. Regionally, the property is well-positioned between Fort Belvoir and Quantico Marine Base, which combined expect to gain more than 20,000 government and private employees in the next year due to the Base Realignment and Closure (BRAC) program. Locally, the property is located adjacent to the Potomac Mills Mall. Should the current lessee – a government defense contractor – vacate at the end of their lease, we are prepared to redevelop the building into an office, flex or retail use.

Commonwealth Distribution Center
In a $6 million all-cash transaction (January, 2011), we acquired the debt on a 221,000-square-foot, class A, LEED certified warehouse in the Greenville-Spartanburg market of South Carolina. The building was 47% leased to a credit tenant. Greenville-Spartanburg is a 140-million-square-foot industrial market that is well positioned for distribution in the Southeast due to its proximity to Charleston, Charlotte, and Atlanta. Within nine months after closing, Alliance had negotiated a deed-in-lieu of foreclosure with the borrower (and obtained the fee ownership), secured financing, completed the unfinished base building improvements, and leased an additional 78,000 square feet.

Southport Industrial Center
In an $11 million transaction (September, 2011), we acquired the fee interest in a 355,000-square-foot warehouse and manufacturing facility from a private owner who did not wish to take on future leasing nor tenant improvement obligations. The property was 100% leased to a single tenant with five years remaining on the lease at the time of acquisition. The tenant no longer required the space but was unable to effectuate a sublease transaction given the limited remaining term and disinterest in funding tenant improvements for a subtenant. During due diligence, we negotiated a rolling, early termination option with the tenant that allows us to seek a new, prime lease on the property while having a pre-negotiated early termination payment from the existing tenant that can be used to pay for re-tenant costs.