New York-Based Co. Buys Hope Valley Square in Durham for $7.7M

by Adriana Pop, Associate Editor

An affiliate of DNA Partners of Cold Spring Harbor, N.Y. has acquired the 40,524-square-foot Hope Valley Square retail center in Durham.

According to the Triangle Business Journal, Hawthorne Retail Partners of Charlotte sold the property for $7.7 million. Berkeley Capital Advisors represented the company in the sale.

Formerly known as Shannon Plaza, the shopping center at 3710 Shannon Road is anchored by one of the busiest U.S. Postal Service offices in the city. According to the newspaper’s quarterly Space survey, Hope Valley Square was nearly 100 percent leased during this year’s first quarter. Three popular restaurants, including Only Burger, Bull Street Gourmet & Market and Pop’s Backdoor South are also among the center’s tenants.

In 2007, Hawthorne Retail Partners acquired the property for $2.4 million. Through substantial renovations, the company has converted the distressed structure into a Class A neighborhood center. Upgrades included a façade enhancement, a new pylon sign, parking lot resurfacing, as well as parking lot lighting and landscaping improvements.

In regional news, CVS has signed a 20-year ground lease to build a new, 13,000-square-foot stand-alone store on the vacant outparcel at the 113,000-square-foot Rams Plaza shopping center in Chapel Hill.

The 30-year-old retail property at 1728 Fordham Boulevard is owned by the Kalikow Group, through a joint venture entity known as Rams Plaza Associates L.L.C. The company purchased the center in December 2011.

Rams Plaza is currently 95 percent occupied and anchored by Food Lion. As a long-time junior anchor, CVS will continue to occupy 8,500 square feet of space within the center until the new store is completed.

The new lease marks the beginning of the second phase of a $3 million renovation plan. In March, the owners completed the first phase, which consisted of $1.5 million in upgrades to the facade, building structures, interior courtyard and parking areas.

“We are extremely pleased to announce this agreement with CVS, which allows us to complete our redevelopment of this shopping center,” said Edward Kalikow, president and CEO of The Kalikow Group. “Tenant retention remains very high in the area, which has significant barriers to entry, and we are gratified that CVS has chosen to expand at the new Rams Plaza.”

Photo credits: www.loopnet.com

Erwin Square Plaza in Downtown Durham Changes Hands

by Adriana Pop, Associate Editor

In a $37.5 million deal, Federal Capital Partners of Maryland has acquired the 10-story Erwin Square Plaza office building in downtown Durham from National Asset Services Inc. of Los Angeles. Ben Kilgore at CBRE represented the seller in the transaction.

Located at 2200 West Main Street in the master-planned Erwin Square Development, the property offers 215,048 square feet of office space, as well as 23,744 square feet of retail and a four-level parking deck. Duke University and Duke University Health System-related companies and organizations are among the building’s tenants, which has a current occupancy rate of 96.2 percent.

“Erwin Square Plaza is of very high quality and is well-located in downtown Durham, which has seen enormous growth and revitalization in the last 10 years. The Durham CBD is experiencing healthy demand for office space, and the property has maintained a 95 percent+ occupancy since 2007. We look forward to renovating the property back to its institutional-grade potential and repositioning the important retail portion of the property,” FCP Managing Partner, Esko Korhonen said in a statement.

Federal Capital Partners now has controlling interest in or has provided financing for more than 350,000 square feet of commercial space and nearly 2,000 apartments in the Triangle area. This includes the 156-unit West Village community currently under construction in downtown Durham.

In other news, Blue Cross Blue Shield of North Carolina is expanding its Durham campus on University Drive with the acquisition of two office buildings.

According to the NewsObserver, the company has purchased University Place 4 and University Place 5 for a combined $10 million. Together, the properties offer approximately 100,000 square feet of space. The new acquisitions will enable Blue Cross to relocate its operations from the current headquarters in Chapel Hill to Durham by next year.

Blue Cross is North Carolina’s largest insurer, with more than 4,000 employees across the state. The company now owns about 560,000 square feet in eight buildings at its University Place corporate campus in Durham.

Photo credits: CBRE

Concord Eastridge Plans 150-Key Hyatt Place Property on Raleigh’s Centennial Campus

by Adriana Pop, Associate Editor

Concord Eastridge Inc. is planning to develop a Hyatt Place hotel and conference center on North Carolina State University’s Centennial Campus in Raleigh. According to the Triangle Business Journal, construction on the project is expected to begin early next year and be complete by mid-2015.

The building will rise across 10 acres of land on the southern shore of Lake Raleigh. Plans call for 150 guest rooms and between 7,500 and 10,000 square feet of meeting space.

In 2009, the university selected Concord Eastridge as developer, owner and operator of the new hotel and conference center. Initially, the company had proposed the construction of 250 hotel rooms and as much as 30,000 square feet of meeting space. The project has been eventually scaled back as a result of the hospitality industry’s changing dynamics in the region over the past few years.  

Hyatt Place is one of the nine hotel property brands owned by the Hyatt Hotels Corporation. In the Business Travel News’ 2012 Hotel Chain Survey, Hyatt Place was recognized as the country’s top select-service hotel brand. Other such properties in the Triangle are located on Corporate Center Drive in west Raleigh, on Airgate Drive near the Raleigh-Durham International Airport and on Navaho Drive in north Raleigh.

In regional news, life sciences consulting firm Compliance Implementation Services (CIS) has leased 23,000 square feet within Duke Realty Corp.’s Perimeter Two office building at Perimeter Park in Morrisville. Jones Lang LaSalle’s Raleigh-based Tenant Representation group advised the tenant in the negotiations.

Slated for completion in June 2014, the five-story, 205,000-square-foot structure at 3020 Carrington Mill Boulevard will be Duke’s first speculative office project in the region in five years.

The property’s tenant base will also include Fujifilm Medical Systems, a leading provider of medical image and information products and technologies, which will take about 42,456 square feet, as well as MaxPoint Interactive, a digital advertising technology company, which has signed a lease for 32,715 square feet of space.

Photo credits: raleighnorth.place.hyatt.com

Development Group Plans Major Apartment Project East of Downtown Raleigh

by Adriana Pop, Associate Editor

The Florian Companies, along with Hyde Street Holdings and Banner Apartments are planning to develop a 224-unit, four-story apartment building near Moore Square in downtown Raleigh.

According to the NewsObserver, the project will be located on a vacant 2-acre lot currently owned by Gordon Smith III. The development group intends to close on the purchase of the site by the end of the summer.  

Called The Lincoln, the new development will include a mix of one- and two-bedroom units, as well as a 321-space parking deck, a pool and an interior courtyard. JDavis Architects of Raleigh is the designer of the project.

If approved by the Raleigh Planning Department, the complex would become the area’s second major residential development, trailing only the 320-unit apartment tower proposed for the southwest corner of Martin and Blount streets.

“I think downtown Raleigh is really going through a tremendous boom in its progression and its desirability,” John Florian, president of The Florian Companies, told the newspaper. “So we really think there are a lot of drivers that are going to continue to drive demand for housing in downtown Raleigh right now. And over the long run it’s going to get better and better.”

Data from Karnes Research and the Triangle Apartment Association shows that the city’s downtown area has about 1,202 apartments under construction and more than 1,500 on the drawing board.

In multifamily transaction news, Trade Street Residential, Inc. has purchased the newly-built 256-unit Woodfield Creekstone apartment community (pictured) in Durham for $35.8 million.

Completed in April 2013, the garden-style property is currently 92.6 percent leased and 83.6 percent occupied. Amenities include a clubroom with cyber cafe, a business center, a resort style pool and pool lounge, as well as a fitness center and movie theatre.

The acquisition was partially funded with a new $23.3 million 10-year term first mortgage at a fixed interest rate of 3.88 percent, the company announced.

Photo credits: www.woodfieldcreekstone.com

Federal Capital to Break Ground on Third Phase of Downtown Durham Project

by Adriana Pop, Associate Editor

Construction on the third phase of West Village in downtown Durham is expected to start in June, Federal Capital Partners announced.

The Maryland-based developer is planning 156 luxury apartments in a new six-story building which will be located on the block between West Main Street and West Morgan Street. Upon completion, the project will offer a mix of studios, one- and two- bedroom units. Bell Partners of Greensboro will be in charge of leasing.

Amenities will include a club/lounge area, on-site bicycle storage, secure access, as well as an elevated pool deck. Residents will also have access to the popular and environmentally friendly Zipcars program.  

Consisting of the conversion of two former tobacco warehouses, the West Village development is considered to be the largest historic renovation project in North Carolina. According to the Triangle Business Journal, the first two phases have been developed by a real estate company led by former Duke basketball stars Christian Laettner and Brian Davis. The total investment in the project amounted to $170 million.

In 2012, Federal Capital acquired the majority interest in the properties. Built in 2000, West Village I offers 241 loft apartments, 10,000 square feet of retail space, as well as parking. West Village II was built in 2007 and includes 212 luxury lofts, 70,000 square feet of office space, as well as 30,000 square feet of street level retail.

“The next phase of West Village expands the footprint of a key participant in revitalized downtown Durham and provides better connectivity to the heart of downtown,” said Bryan Kane, vice president of Federal Capital Partners. “With strong occupancy at our existing West Village properties and continued demand for apartments in the downtown district, we view this phase as important to our West Village community of residents, retailers and businesses, and also invigorating to the entire city.”

Photo credits: http://www.bellapartmentliving.com/NC/Raleigh/West-Village