In-Rel expands Memphis portfolio

Buys five-story Comcast office building at a bargain

Friday, December 11, 2009

Memphis Business Journal
By Andy Ashby

In-Rel Management, Inc., has completed its purchase of the former Comcast building, buying the five-story, 112,679-square-foot property for $5 million, or $44.37 per square foot.

The building, constructed at 6555 Quince in 1990, has 15 tenants and is 45% occupied.

In-Rel has renamed it Quince Centre.

Miami-based LNR Partners, Inc., the building’s loan servicer, took over the building after its German ownership group, Germantown LP, defaulted on a loan.

Ron Riley, executive vice president at In-Rel, has had his eye on the property for some time.

“I looked at this property back in 2008 and was unable to reach an agreement with the then-current ownership,” he says. “Once the special servicer got involved, we were a likely candidate being local and already having expressed interest.”

The building brings In-Rel’s Memphis portfolio to 1.4 million square feet of office space.

The company owns, operates and leases Clark Tower, Poplar Towers, Lynnfield Office Park, the 2400 Poplar Building and the Lipscomb & Pitts Building on Union Extended.

In 2009, the land and building were appraised at $8.4 million, according to Shelby County Assessor of Property documents. Germantown LP bought the building in October 1999 for $11.2 million.

In-Rel plans to spend $300,000 to make parking lot improvements, install new monument and digital directory signage and other common area updates, according to In-Rel director of leasing Frazier Baker.

The property had always been more than 90% leased until 2008, when Comcast moved to a new 62,000-square-foot building at 3251 Players Club Parkway that was built for the company by Highwoods Properties, Inc.

“After Comcast’s exit, it seemed clear that the building was lacking a clear identity,” Baker says. “By renaming and marketing the building as Quince Centre, we hope that we will be able to create new buzz and attract new tenants.”

This is In-Rel’s second acquisition to close this year; the other is a shopping center in Tampa, Fla. The company also has another out-of-state property under contract.

“In-Rel is in a very fortunate position in these economic times and is poised to take advantage of opportunities,” Riley says. “In this environment, if you prove you can close a transaction, the opportunities are many. The challenge is to closely scrutinize each opportunity to ensure we are aligning our growth with our long-term strategy.”

Quince Centre fits into In-Rel’s business philosophy, according to Riley. It gives In-Rel Memphis properties in various price points from Midtown to the 385 corridor.

“It is our intention to continue to grow in those markets which we are currently located to take advantage of economies of scale,” Riley says. “It is also important that the property complements the existing portfolio by either offering a different price point, different submarket or different amenities.”

The majority of the building’s vacant space is concentrated on the fourth and fifth floors, where the entire fourth floor of 24,353 square feet and a portion of the fifth floor of 13,070 square feet is available.

“The addition of Quince Centre is a perfect complement to our existing portfolio in Memphis,” Baker says. “It’s located in the one of the strongest submarkets in Memphis and we expect it to perform very well.”

Investec Realty Services LLC had previously managed and leased the property.
In-Rel Management, Inc.
Office real estate firm
HQ: Lake Worth, Fla.
Local employees: 15
Local address: 5100 Poplar, Suite 2419
Local phone: (901) 682-9260
Web site: www.in-rel.com

aashby@bizjournals.com | 259-1732