Seven Summit County office buildings, including some in the Embassy Park complex in Bath Township and Fairlawn, have been sold by one investment group to another for $30 million.
Rubenstein Partners of Philadelphia and an affiliate of investor Mark Munsell of Beachwood were the sellers of the properties, all built by area real estate developer John Dellagnese & Associates.
The buyer is Group RMC of New York.
Rubenstein Partners, which bought the properties in 2012 in a deal involving Munsell, buys office properties that it considers to be undervalued — dated properties and ones with lower occupancy rates. Rubenstein then improves the properties with the hope of selling them at a profit.
Today, the seven buildings, with a total of 400,000 square feet, are about 80 percent full.
Significant discount
A spokesman for Rubenstein said Thursday that the Embassy Parkway properties were acquired in 2012 at a “significant discount” from the $30 million.
“The value achieved through this transaction exemplifies the upward trend of suburban office market leasing activity and declining vacancy rates in Northeast Ohio, where market fundamentals are at their strongest since the recession in 2007,” Russell Rogers, who brokered the sale with Thomas Gustafson of the Collier International real estate brokerage, said in a news release.
Five of the buildings are in the Embassy Park complex, one is at 3560 W. Market St. in Fairlawn, east of Cleveland-Massillon Road, and one is at 5399 Lauby Road in Green, near the Akron-Canton Airport.
They were all built by area real estate developer John Dellagnese & Associates, which began developing Embassy Park in 1986.
A spokesman for Rubenstein said Thursday that the Embassy Parkway properties were acquired in 2012 at a “significant discount” from the $30 million. Rubenstein bought the entire “Embassy Park Portfolio,” which was composed of 10 office buildings, that year.
At the time, the occupancy rate for the overall portfolio was 68 percent.
Deal on existing loans
Rubenstein bought all 10 properties through a deal that involved paying off existing loans at a discount.
The previous owner and a special servicer — a company that handles troubled debts — were involved in the deal, and Munsell continued to be a minority owner.
Brandon Huffman, director at Rubenstein, said in the news release that the purchase in 2012, while “fairly complex,” allowed Rubenstein to pursue its “value-added business plan to improve and lease up the assets, leading to successful disposition.
Rubenstein sold two of the 10 buildings in 2012 and 2013.
Another building that was part of the initial purchase is under contract to be sold to the building’s main tenant.
The addresses of the seven buildings sold this week are:
3560 W. Market St.; 3700 Embassy Parkway; 3737 Embassy Parkway; 3875 Embassy Parkway; 4000 Embassy Parkway; 4040 Embassy Parkway, Fairlawn; 5399 Lauby Road in Green, near Akron-Canton Airport.
Katie Byard can be reached at 330-996-3781 or kbyard@thebeaconjournal.com.