Done and Done

Bhaidani then helped the buyer raise about $10 million from accredited investors. “We were able to raise private equity through an offering memorandum, so it was essentially a cash closing.” The sale closed in January 2022. Then, a long lead time to bring utilities to the site delayed the start of construction beyond the terms of the deal, requiring Bhaidani to negotiate a post-closing agreement with the developer.

The Market Center at Harvest Green started pre-lease marketing for its 40,000 square feet of leasable space as construction broke ground early in July of this year, and at that point agents had signed one tenant and secured two letters of interest. “In addition to retail, we are hoping for medical offices, restaurants, a tutoring center and other neighborhood services,” Bhaidani says.

Takeaways:

In this deal, it was important to consider the interests of the master-planned community while acting in an advisory capacity to shepherd a project that would not only be financially viable but also serve the needs of residents, community members and patrons. That meant added costs, but it likely also sealed the deal. “A lot of commercial property buyers are looking only at profit, but in this case, they were looking for a balance of ROI and creating a good place for the community,” Bhaidani says.

Beck Aesthetic Surgery Center

Donald Beck, CCIM, Principal, Interurban Properties, Charlotte, N.C.

Dr. Joel Beck’s cosmetic surgery practice was in serious need of a facilities facelift. And as it turned out, his commercial broker brother was just the man for the operation.

In a bid to improve his quality of life and reduce his cost of living, the plastic surgeon in 2018 had made the bold decision to relocate from the San Francisco Bay Area, where he had built a robust practice, to Charlotte, N.C., where his brother Donald, CCIM, lived. For a time, he practiced on both coasts, gradually shifting his time and attention away from California and toward Charlotte, where his practice was crammed into a 1,981-square-foot office his brother had found as transitional quarters. (His California office had been 3,500 square feet.)

By 2020, Dr. Beck was eager to find some elbow room and fulfill his vision of a state-of-the-art surgery center. But the search for a suitable location would be complex: The right building would have to be in a location appealing to his more affluent clientele while also meeting requirements for surgical procedures he could perform onsite, rather than negotiate for time in oversubscribed hospital operating rooms.

He turned to Donald’s brokerage to help navigate the shoals of competitive real estate in fast-growing Charlotte. The market for suitable locations was tight for both buildings and land, Donald Beck says. “We considered a number of options, including freestanding single-tenant buildings, Class A medical office space, as well as prime, newly renovated suburban office buildings.” They were looking in “a wedge running from downtown to south Charlotte, south of the outer belt, I-485,” he says.

Class A office space that was not already geared toward medical use seemed to be off the table. “We looked at one promising building that was undergoing major renovation, but the landlord balked at having clients leaving the building in a wheelchair,” which sometimes happens after procedures that require anesthesia, he says.

Available space, buildings and land are often discovered the old-fashioned way, through networking."

—Donald Beck

Finally, Donald’s network came through. He found a planned two-story medical building that had yet to secure tenants or start construction, just off I-485. With his brother’s help, Dr. Beck began lining up specialists in surgical center design and licensing, and soon found his vision expanding from something akin to his California office to a comprehensive 11,000-square-foot showpiece. The Beck team signed up for the entire first floor.

“We had to negotiate a tenant up-fit allowance,” Donald Beck says. “The cost of building out the space for plastic surgery is very expensive. So we negotiated the office area, plus the air handling and equipment requirements for the building, because you can’t share surgical air with office space.”

Negotiations for the $3.8 million transaction began in June 2021, and the lease was signed that October, with expected delivery of the shell building in September 2022. Although the building developer MPV Properties had tried to anticipate delays by ordering steel early, supply chain issues still delayed delivery until August 2023, meaning Beck Aesthetic Surgery Center will open in 2024.

© SHELL BUILDING: ROBERT JOHNSON ARCHITECTS

In fast-growing Charlotte, N.C., where the market is tight for both buildings and land, the Beck team negotiated a tenant up-fit allowance to create a comprehensive 11,000-square-foot plastic surgery center.

Takeaways:

“Available space, buildings and land are often discovered the old-fashioned way, through networking. Relocating companies are well advised to work through local brokers,” Donald Beck says. In addition, “a user’s space requirements can change, reflecting the input of employees, consultants, regulatory agencies and others. It is best to explore and confirm those requirements before initiating a search.”

“Whether it was my brother or another broker, I couldn’t have done it without one,” Joel Beck says. “Especially coming into a new part of the country where I wasn’t familiar, having him point out the areas of the city where it would be good for my business was critical. Knowing the competitive price per square foot helps. Knowing some credible people that we could turn to for financial help was huge.”

An Exchange of Churches

Christopher Cockerham, CPM, broker, Cockerham Commercial of F.C. Tucker, REALTORS®, Bloomington, Ind.

Sometimes in commercial real estate, you get what you pray for.

It all started in 2022, the third year of the pandemic, when Christopher Cockerham’s brokerage took a distress call from Rivers Edge Fellowship Church in Bedford, Ind., 20 miles south of his home base in Bloomington. “Just before COVID they had moved into a car dealership. They turned the showroom into a sanctuary, offices and Sunday school rooms and turned a lower level into a teen center,” Cockerham says. “Everything was going great until the pandemic hit. If you weren’t able to pivot to an online system, you struggled, and this church did.”

As the church’s membership and income shrank, the costs of upkeep on the sprawling property were swallowing its reserves. Rivers Edge officials wanted Cockerham’s help with selling the building and grounds as quickly as possible, while they searched for a more modest new home themselves. Preparing to market the building, Cockerham, CPM, assessed it as likely to return to a use akin to the former car dealership. He drew up a flyer touting it as a “light industrial building” with “potential for a business needing administration offices along with warehouse space and a potential showroom.” As he posted signs and shipped the flyer to his 20,000-member database, in the back of his mind he figured a nearby military base might have a use for it.

As much as we think about the internet these days, there’s nothing like a sign sometimes to find the buyer."

—Christopher Cockerham

He did not expect the next call. Guide Pointe Pentecostal Church across town was in the opposite situation from Rivers Edge, bursting at the seams in its traditional limestone building. They had spotted the Rivers Edge “for sale” sign and thought the building looked perfect to accommodate their growing programs, including a pre-K-8 school. In the process of negotiating the sale, Guide Pointe officials asked where Rivers Edge would be going and learned that they were frantically searching for a new location. “They said, how about our building?” Cockerham recalls.

Rivers Edge jumped at the chance, and Cockerham found himself brokering a change of places between two congregations. In another twist, the move became almost literal musical chairs. Around the same time, Cockerham sold yet a third church whose new occupants needed chairs. Cockerham procured a surplus from Rivers Edge. “As a broker, you never knows what services you’ll end up providing,” he says.

Selling and buying churches isn’t as simple as negotiating among individuals, he says. “Most churches require meeting with a board of trustees to explain the real estate process. I sat through several Sunday evening sermons so that I could talk to the congregation about how the sale was coming along.”

Getting to closing proved somewhat hair-raising, Cockerham says. “Guide Pointe didn’t do their books in a conventional way that banks could underwrite.” After going back and forth with a bank, “they had to redo their books, and it postponed closing by six months.” As closing stretched from December 2022 to June 2023, Rivers Edge continued to bleed red ink, inching ever closer to the bottom of the reserves barrel.

Now that the deal is done, “Both of them feel really good financially,” says Cockerham.

Takeaways

“I would never have guessed it would be a growing church trading with a shrinking church,” Cockerham says. Though he used all the marketing tools at his disposal, it was simple signage and word of mouth that made it happen. “As much as we think about the internet these days, there’s nothing like a sign sometimes to find the buyer. “All deals seem to make sense eventually. As weird as they come together, in the end they make sense, and I couldn’t imagine it any other way.”