Disaronno Plaza at 80 Cottontail Lane in Somerset — Courtesy: Marcus & Millichap
By Joshua Burd
The longtime owner of a nearly 90,000-square-foot office building in Franklin Township has sold the property for $7.5 million, brokers with Marcus & Millichap said Monday.
Located in the town’s Somerset section, the property at 80 Cottontail Lane was 49 percent occupied at closing and drew interest as a value-add opportunity. It changed hands after dozens of tours from a range of prospective buyers, Marcus said, including local, regional, national and international operators ranging from private investors to institutions.
“The buying criteria varied amongst the various buyers,” said Chez Eider, a senior associate of investments with Marcus. “Some were already in the office market looking to further expand their holdings. Others were opportunistic investors looking for buildings to occupy a portion and lease up the rest. While other buyers came from more aggressively priced asset classes, pursuing office investments to achieve a higher yield.”
Eider brokered the transaction alongside the firm’s Alan Cafiero, Brent Hyldahl and Ben Sgambati. They noted that the now-former owner, which they represented, owned the 88,312-square-foot building for nearly 30 years before selling it at a capitalization rate of 5.87 percent.
The buyer is now primed to add value by leasing up the remaining space at what’s known as Disaronno Plaza.
“The deal was quite challenging, as the building had collectively lost 17 percent of its tenancy throughout the marketing, due to non-renewals from multiple tenants, while another long-term tenant expanded their space within the building,” Eider said. “Despite these challenges, the buyer performed by meeting aggressive terms, with a large deposit becoming nonrefundable at the end of a short seven-day due diligence period.”
Joseph Belgiovine of Marcus and Millichap Capital Corp. also worked on the transaction.
