Case Study

Duke Primary Care Butner

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01.

The Issue

Duke University Health System had five years remaining on a lease that included above market rents at a strategically critical primary care location.

02.

The Solution

Davis Moore worked with DUHS to put the building under contract while simultaneously coordinating with an investment sales broker to shop a new fifteen (15) year DUHS lease. A competitive process was run to select a buyer to best serve the DUHS needs for efficient capital and excellent property management. The purchase agreement was then assigned to the buyer that required a low yield and therefore provided DUHS with the much lower rent.

03.

The Benefit

DUHS was able to fully capture the value their AA credit brings to a landlord with a long term lease while substantially lowering their rent to provide an immediate annual savings of 26 percent. The only risk was due diligence costs while a new buyer was secured to take over DUHS’ contract to purchase the building.