AW Property Enters North Carolina Market

Blue Ridge Center I

In a $29 million deal, North Palm Beach, Fla.-based AW Property Co. has entered the North Carolina market by purchasing Blue Ridge Center I and II, a two-building, 123,953-square-foot medical office campus in Raleigh. The company acquired the property in a partnership with Blue Ridge Realty, which was also the seller, according to CommercialEdge information.

AW bought the Class A asset through its Medical Office Fund IV, a $300 million, fully discretionary core-plus investment vehicle targeting medical office buildings in Southeastern U.S. markets. Prior to the purchase, the fund’s portfolio had encompassed 450,000 square feet of medical office space across Tennessee and Virginia.

The acquisition came on the heels of a significant financial move by AW. In early March, the firm recapitalized a 19-building, 525,759-square-foot medical office portfolio in Florida through a $193 million joint venture equity raise with an undisclosed national institutional investor. The portfolio was owned by AW Medical Office Fund III.

A West Raleigh medical office property

Built in 1994, the campus is situated on nearly 7 acres at 2605 and 2709 Blue Ridge Road, across from the 665-bed UNC Rex Hospital. The property features 21,316-square-foot floorplates and a parking ratio of 5 spaces per 1,000 square feet. The new partnership intends to invest significant capital to reposition the two medical buildings anchored by UNC REX Healthcare.

Blue Ridge Center is some 6 miles northwest of downtown Raleigh, north of Interstate 40. The West Raleigh property is surrounded by numerous other medical office buildings; the submarket has more than 1.2 million square feet of medical office in its inventory, with one-third of the buildings located on Blue Ridge Road, according to CommercialEdge.

The same data provider shows the campus was the first medical office asset to sell in West Raleigh and the second to change hands in Raleigh-Durham since the beginning of the year. The metro’s first medical office sale closed in early February, when LaSalle Investment Management paid $37 million for the 41,035-square-foot Duke Medical Plaza in Durham, N.C.