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Real Estate Forward

Banner Health Center at the Grove

Phoenix, Arizona

Winstead assisted a private equity real estate client in acquiring a 70,000-square-foot medical office building (MOB) occupied by Banner Health.

ESTIMATED VALUE:
$48.5 million

LEAD ATTORNEYS:

OTHER TEAM MEMBERS:

STATUS:
Deal completed February 2023

Winstead assisted a private equity real estate client in acquiring a 70,000-square-foot medical office building (MOB) occupied by Banner Health. However, this was not a routine real estate deal. The MOB was situated in a mixed-use development still being constructed, presenting a unique set of challenges.

Winstead’s real estate team meticulously reviewed declarations and easements, uncovering discrepancies within the development plans. They discovered potential challenges, such as parking allocations and future construction costs, that could have been waiting for an unsuspecting buyer.

Besides the unfinished development, Banner Health, the tenant, was also busy constructing within the MOB. This meant that Winstead had to juggle two sets of ongoing construction projects, each with its own set of issues.

In addition, the seller/developer left behind obstacles in recorded documents affecting the property. These documents could have burdened our client with future development costs, including with respect to the parking garage being built nearby.

Winstead, being resourceful as always, came up with a two-pronged attack. The team amended key documents to clarify responsibilities and negotiated an escrow holdback to cover potential future costs and tenant improvement allowances. This solution protected our client from unforeseen liabilities and ensured a smooth closing.

Thanks to Winstead’s unwavering dedication, our client was able to acquire the MOB without inheriting a future financial headache. This deal showcases Winstead’s ability to navigate complex real estate transactions, ensuring their clients close transactions confidently, even in the face of hidden challenges.