Medical office building purchased in Arlington

Randol Mill

SkyWalker Property Partners has purchased a 13,444-square foot fully leased medical office building near Texas Health Arlington Memorial Hospital for its fund, When Opportunity Knocks LLC.

The property is secured by a 10-year lease with USMD Health System, which signed the new agreement on the same day that the deed changed hands. The building at 809 W. Randol Mill Rd. is directly across the street from a 417-bed, full-service hospital and less than 1.5 miles from the University of Texas at Arlington, AT&T Stadium and the city center.

The buyer of record is Doctor Mill Good LLC. The seller is 809 Randol Mill Realty Venture LLC, a group of six physicians whose retirements sparked the decision to sell the real estate – a single-story brick building with 80 parking spaces developed in 1976 on a 1.08-acre tract along one of the city’s most-heavily traveled east-west thoroughfares.

“It had been under contract, but that fell out so we immediately scooped it up. This is a fundamentally strong property at an irreplaceable location in our own backyard,” said Clint Holland, acquisitions director for Arlington-based SkyWalker Property Partners, the fund’s manager.

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USMD will be undertaking a major renovation that will be done in stages so on-site physicians can continue to work. “USMD was given a healthy tenant-improvement allowance and will be adding to it to completely change the interior,” Holland said.

The Arlington facility is one of nearly 50 multi-specialty clinics in the USMD Health System, a North Texas-based network of more than 250 physicians and associate practitioners in at least 20 specialties. USMD operates two hospitals, one cancer treatment center and clinics, 27 of which are accredited primary care locations.

The just-closed transaction is the first medical office property for the value-add fund’s portfolio. “Our program went into play when USMD signed the new lease,” Holland said. “There is value in the 10-year lease and that irreplaceable location. It’s the right combination for our parameters.”

Gary Walker of SkyWalker Property Partners represented the buyer and negotiated USMD’s triple net lease. The seller’s broker was Shane Benner of Coldwell Banker Commercial Advisors.

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When Opportunity Knocks has about $65 million of buying capacity in hand for office, industrial, flex and retail properties in Texas and the surrounding states. “We’re busy trying to identify properties and opportunities,” Holland said.