CBRE has announced the $28.1 million sale of 187 Chastain Road NW, a brand new, fully-leased, medical office building occupied in Kennesaw by Piedmont Healthcare, Inc. The property was sold by PLSQ Chastain, an entity comprised of investors from Quintus and Pope & Land Real Estate. The buyer was not disclosed. 

Pope & Land developed the 39,642 sq. ft. building for the ownership entity and arranged a long-term lease with Piedmont Healthcare which was represented by CBRE. Financing was provided by Renasant Bank, Brasfield Gorrie was the contractor and EYP was the architect.

“We signed the lease during the peak of the Covid-19 pandemic in 2020 and the tenant occupied their new building before the end of 2021. It was a complicated project with a tight timeframe, but the development team delivered on time and on budget and CBRE assisted us from start to finish,” said Mason Zimmerman, Senior Managing Development Partner for Pope & Land.

The Property sold upon completion for a record-low cap rate for a fully stabilized medical office building in the Southeast. The brand-new long-term lease with Piedmont Healthcare, which maintains an ‘A1’ credit rating by Moody’s, contributed greatly to the exceptional pricing.

Lee Asher, Chris Bodnar, Jordan Selbiger, Ryan Lindsley, Sabrina Solomiany and Zack Holderman with CBRE U.S. Healthcare and Life Sciences Capital Markets represented the seller. 

“As shown by this transaction, investor interest in well-leased properties to dominant healthcare systems remains insatiable and is not just limited to Healthcare REITs or traditional core real estate funds,” said Lee Asher, Vice Chairman at CBRE. “This validates the trend we're seeing that investors now are highly focused on alternative asset types, such as medical office and life sciences, that have weathered both the Great Recession and the ongoing COVID-19 pandemic.”

Built specifically for Piedmont Healthcare in 2021, the 39,642-square-foot property houses a linear accelerator (LINAC) and includes imaging, infusion and radiation/oncology suites for cancer treatment on the first floor. The second floor includes more than 30 exam rooms for multiple specialties.

“Strong partnerships are the foundation of our business. Pope & Land executed the development plan flawlessly and the CBRE team did a fantastic job telling the Piedmont Healthcare story. The results of the transaction speak for themselves,” said Kelly Keappler, President, Quintus Corporation.