Decatur office sale clears with its anchor as lender

When Delta Community Credit Union wrote the acquisition loan for 160 Clairemont Ave., it was financing the very building it anchors: Parmenter Realty Partners and Wellings Capital used the credit union's money to pay TerraCap Management $18.6 million for the roughly 125,000-square-foot office building a few blocks north of Decatur Square. Connect CRE reported the sale, with the Atlanta Business Chronicle first on the price.

At 78% occupancy, the building has about 26,000 square feet to lease, including a 13,933-square-foot contiguous block, and the $18.6 million price works out to about $149 a square foot, a number that already assumes a 22% vacancy rate and a buyer willing to carry it. TerraCap, the seller, is passing that leasing risk to a buyer that has seen the asset before.

Having owned 160 Clairemont from 2011 to 2015 and overseen extensive renovations in that stretch, Parmenter now plans to upgrade amenities again. Avison Young's Chris Godfrey and Monica Speak will lead leasing and marketing, and OnPace Partners brokered the sale.

Office clearing prices are being set in buildings like this one—mostly leased, a known seller, and a repeat buyer carrying vacancy—while the landmark towers get the attention. The market has moved from mark-to-market to trade-to-trade; every closed sale at a vacancy-tolerant price becomes the data point for the next appraisal. The Decatur trade sharpens that picture because Delta Community Credit Union holds the acquisition loan and anchors the building. A lender with its branch in the collateral is not making a speculative bet on repositioning; it is underwriting its own address.

That structure is a cleaner underwrite than most office trades get, and it points to where clearing prices are being set: by occupants and repeat owners who can finance buildings as they are. The next Decatur office deal will be measured against this one.