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Thursday, May 2, 2013

IO Factory -- Formerly Le-Nature's Bottling Plant -- Sells for $72m

The Former Le Natures, Inc. Bottling Facility in Tempe
VIZZDAMay 2, 2013 – IO, a manufacturer of data center modules, has purchased the manufacturing facility that has served as the company’s headquarters since January 1st, 2009. The seller was CBRE Global Investors and the sale price of $72M represents a Per Square Foot price of $135.63.

Anthony Wanger, President of IO, and Pasha Zargarof, General Counsel of CBRE Global Investors, were signatories on the deal. The affidavit of value states that IO paid $300K in cash and financed the remainder, but no debt was recorded.

The IO Factory—as it is now known—was originally developed in 2005 as a bottling plant for Le Natures, Inc. After a massive fraud forced Le Natures to file for bankruptcy in 2006, this facility was re-purposed for use as a data center and light manufacturing facility.

The center is located at the southeast corner of SR-143 & Loop 202, at 615 N 48th St, on 30.40 acres zoned CP/GCP. It is most commonly described as 530,856 ft2 although the Maricopa County Assessor lists 507,646 ft2. The front office of this site is 2 & 3 stories and 70K-80K ft2.

According to the Arizona Republic, “The center provides ‘co-location services’ that allow multiple organizations to rent space in the same facility to store data servers that support their technology needs.” Elsewhere the center is described: “IO Phoenix is the largest commercially available data center in the United States to achieve Tier III Design Certification from the Uptime Institute.”

According to IO the center employs 50+ data center technicians for the manufacture of data center modules on multi-station assembly lines that can achieve “stock to dock shipment within 6 days”. 

This property was originally developed by First Industrial Realty Trust and sold to CBRE on Jan 6, 2006 for $88.5M or $166.71 per ft2 with $1.0M down; and a loan of $62.3M with IXIS Real Estate Capital, a Morgan Stanley affiliate, which was rolled into a securitized commercial debt offering.  CBRE sold interest in the property to multiple individual investors.

On June 6, 2008 the thirty six individual investor entities transferred their fractional interest in thirty six transactions totaling $20M to a CBRE-managed holding company which also assumed the outstanding debt. On December 24, 2008 IO signed a lease for term January 1, 2009 to August 31, 2029, while retaining a purchase option through September 1, 2014. 

For data on this and thousands of other deals visit www.vizzda.com and request a product demonstration.

By:
Edward Moore
Director of Research
www.vizzda.com

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