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4/21/22
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Grunow Memorial Medical Center, a 53k sf medical office building in Phoenix, was purchased by a private Canadian investor for $17.9 mil ($338/sf). The property was sold by Meridian after the firm had renovated and repositioned the building.
The building is located in the Coronado Historic District of Phoenix at 926 E. McDowell and sits adjacent to Banner Health University Medical Center’s Phoenix Campus and Phoenix Children’s Hospital. “The building was constructed in 1931 and originally designed by Arizona architect Lester A. Byron. It was one of the first clinics of its kind in Arizona where doctors could be located near a hospital. It also created the opportunity for patients to see their doctor in more of a residential setting rather than having to go downtown,” said Meridian’s Chief Asset Officer, Dan Rosenbaum.
Meridian acquired the building from PacVentures in August 2017 for $5 mil, when it was 25% leased. The property is now approximately 90% leased to 12 tenants, including DaVita Dialysis and a well-known regional infusion group.
“This project represented a challenging value-add opportunity where we could assist our clients with their outpatient ambulatory strategy,” said Rosenbaum. “We added fire sprinklers to the entire building, upgraded ADA, replaced the HVAC, reduced the load factor by reconfiguring space, and updated many of the second-generation medical spaces for our users.”
Once the repositioning was complete, Meridian formed a joint venture with Harrison Street Real Estate, a Chicago-based investment management firm, for the recapitalization of the property in 2019.
The clinic was built in memory of Lois Anita Grunow, a seven-year-old who passed away from a ruptured appendix. The façade of the grand entrance and the majority of its large windows are adorned with intricate stone carvings that lend reference to symbols of the medical profession. These designs continue throughout the historic, two-story open lobby, which contains various memorial plaques for doctors who have come and gone, as well as large hanging murals that portray significant milestones in the history of medicine.
Mindy Berman with JLL represented Meridian in the transaction.
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