Buy-to-Suit
Many times when a building is on the market for sale, the existing owner is solely interested in selling the building and has no interest in being a landlord or funding tenant improvements, even if a tenant is interested in leasing. Conversely, many tenants are solely interested in leasing all or a portion of a property and have no desire to buy. In these instances, Cambridge Hanover works to bridge this gap by acquiring properties from sellers and adapting the properties to the tenants’ needs. Due to the company’s financial capabilities and track record, Cambridge Hanover provides sellers with the confidence that the transaction will close and provides tenants with the confidence that the building will be constructed to tenant required specifications on time. Examples of past buy-to-suits include Director’s Row in Orlando, FL, South Middlesex Avenue in Cranbury, NJ, Americana Parkway in Columbus, OH, and Mason King Court in Washington, DC.
Case Study: 2100 Directors Row (Orlando, FL)
Cambridge Hanover purchased this 213,000 square foot property from the Eckerd Drugs company, which wanted to sell the building and consolidate four existing distribution facilities into one. While accommodating Eckerd Drugs with a short-term lease for a portion of the building, Cambridge Hanover completed substantial renovations to the property, including re-roofing, re-paving, and upgrading the building. Although the property had environmental concerns, Cambridge Hanover, through its financial capabilities, was able to provide the seller with surety of closing while simultaneously taking steps to resolve the environmental issues. The entirety of the renovated facility was subsequently leased to a predecessor of AmerisourceBergen Services Corporation, a non-credit tenant at the time, thereby causing Cambridge Hanover to take on some credit risk. Prior to moving into the facility, AmerisourceBergen required substantial building improvements, and Cambridge Hanover’s development background provided the tenant with the comfort that its specialized improvements would be completed on time. Since then, the tenant has become a $28 billion publicly traded NYSE company and an industry leader in the field of wholesale drugs. In 2017, Cambridge Hanover sold the property.
