WILMINGTON, DE — Medistar Corp. acquired a 264,000 s/f office building at 3 Beaver Valley Rd. in Wilmington for $61.8 million, marking the first mid-Atlantic investment for the Houston-based developer and investor. The class A building is 94% occupied with Farmers Insurance Exchange as the anchor tenant following significant recent lease-up efforts by Newmark Grubb Knight Frank (NGKF). NGKF Capital Markets represented both the buyer and seller, an entity controlled by KBS Realty Advisors, in the transaction.
“It is no surprise that this office building attracted multiple offers from a number of capable buyers across the country, given its well-established anchor tenant and proximity to many corporate headquarters,” said NGKF's David Dolan, a senior managing director in the Philadelphia office, who arranged the transaction along with executive managing director Jeffrey Mack and senior managing director Michael Margolis in Wayne, PA; senior managing director Neal Dangello in Wilmington; and director Brett Segal in Philadelphia.
Farmers Insurance Exchange, one of the insurers that make up Farmers Insurance Group, renewed its 211,000 s/f lease for 10 years in the fourth quarter of 2014, according to Mack, who, along with Dangello, served as leasing representatives for the building. The NGKF representatives also helped arrange the 39,121 s/f headquarters lease with Solenis International during the first quarter of this year. Approximately 13,000 s/f remains available on the fifth floor.
The New Castle City North submarket, where the office property is located, recorded the most absorption of any Wilmington submarket last year at 270,608 s/f, according to NGKF research. Class A asking rents were also the highest of all submarkets at $29.65 psf.