Challenge: Built in the 1980s, New Market Business Park in Marietta, GA was an underperforming 470,000-square-foot suburban office park of one- and two-story buildings. The property foreclosed in late 2013 with an occupancy rate under 50% and significantly deteriorated conditions.
At the time, the office market was in recovery but the competing low- and mid-rise office markets were still suffering from substantial vacancy. At foreclosure, the market value of the property was $20 million, or 56% of the unpaid loan balance of $36 million.
Strategy: LNR Partners, the nation’s largest commercial mortgage-backed securities special servicer, engaged Colliers to manage and lease the property. To achieve value enhancement and attract interest from tenants, the property image needed to be restored before marketing efforts commenced.
Colliers’ management team addressed the substantial problems created by deferred maintenance, landscaping and cosmetic issues. The leasing team broadly marketed the office park to local and national companies seeking space in the Atlanta area.
Result: The Colliers team successfully leased more than 250,000 square feet — including a large office for a Fortune 500 company — and achieved an occupancy rate of more than 90%.
Colliers marketed the property for sale and successfully closed in June 2017 at $51.8 million, thereby exceeding the unpaid loan balance and required lease-up costs.