9755 Ridge Drive

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Lenexa, KS     |     143,000 SF    |     Investment, Development

Opportunity
In May 2004, Janko Group purchased an approximately 21-acre parcel of land, via a 1031 exchange, in the Renner Ridge Corporate Center. A 103,000 SF office building, built on 11.53 acres of the land, was 100% preleased to Pharmaceutical Research Associates, Inc. with occupancy scheduled for June 2005. A 40,000 SF expansion option had been made available within three years of occupancy.

Results
During construction, the tenant exercised their option to add 40,000 SF for November 2005 occupancy. Despite the mid-construction change of course, the project was built on time, under budget, and financed for 10 years to lock-in the cash flow with increases every two years from rent escalations. In the second half of 2015, the building lease was re-negotiated with a “blend and extend” strategy to appeal to 1031 exchange buyers; the building was sold shortly thereafter. Investors realized an internal rate of return of 30% over a 14-year holding period, and a cash return multiple of 6.1.