Block Funds

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Brian Beggs

Brian Beggs, CFA
Chief Investment Officer

Phone: 816.932.5568
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Case StudyCase Studies: IP Unity

In July of 2007, Block Fund III entered into a saleleaseback transaction with IP Unity Glenayre, which has since been renamed Movius Corporation. Movius is the leader in delivering carrier-grade messaging and multimedia solutions over IP, TDM and enterprise networks.

The building consists of 75,273 SF and sits on 6.67 acres of land with lake views. It is located at 11360 Lakefield Drive in Duluth, Georgia, which is in the Johns Creek office market. The building was built in 1996 of Precast and Glass over a steel deck with poured concrete floors and has a total of 3 floors.

Block Income Fund III was able to negotiate a substantial amount off of the asking price while at the same time convincing Movius to enter into a 12-year lease compared to the 10-year lease they wanted to execute. This deal was brought to the Fund by a relationship in Atlanta and was not widely marketed to other investors. The purchase price represented an 8% capitalization rate on the income which resulted in a total purchase price per square foot of $144.65. Comparable buildings with comparable lease terms in the marketplace at the time of this transaction were trading at capitalization rates of approximately 7% with per-square-foot prices ranging from $150 to $165.