Carter Validus Mission Critical REIT Buys 180 Peachtree

January 13,2012

One of the nation’s premier data centers has a new owner. Carter Validus Mission Critical REIT snapped up 180 Peachtree in Downtown Atlanta for $94.75 million.

Led by Justin Parsonnet and Wendy McArthur, CBRE put together a team that included the Investment Properties Institutional Group and its Critical Environment Practice get the deal done. CBRE professionals Will Yowell, Jay O'Meara and Leigh Martin also worked on the transaction.

“The ownership for 180 Peachtree had created considerable value though multiple large long-term leases recently completed with major data center tenants at the property,” Parsonnet tells GlobeSt.com. “This, coupled with a surge in investor interest in data center properties presented the ideal opportunity to sell the asset.”

Constructed in 1927, the 338,000-square-foot building is the former Macy's Department Store with two adjoining parking decks. It has undergone a series of renovations and now serves as a state-of-the-art data center with premier data center industry tenants.

“180 Peachtree represents one of a small number of multi-tenant flagship data centers in the county,” Parsonnet says. “The opportunity to purchase a data center of this quality and scale, 100% occupied by such well known tenants is truly rare. Accordingly, the property is one of the largest single asset portfolio transactions in some time.”

Parsonnet says there was considerable investor interest in 180 Peachtree, which is part of a larger gradual mainstreaming of data centers as an investment target. As he sees it, savvy investors are recognizing the trend toward the need to compute and store data for everything from online entertainment content, to social media, cloud computing, corporate data storage, online gaming and smart phone—and they are investing in all facets of the data center industry, including real estate.

“Given Atlanta’s relatively low cost of power and considerable fiber optics infrastructure due to it being a connecting point for most rail lines in the Southeast, the city has emerged as an important data center hub for the region,” Parsonnet says. “Numerous data centers of all types have been built in Atlanta in recent years and the trend is increasing.”