New York firm acquires Bentonville office building leased to Walmart for $40.6 million

by Paul Gatling ([email protected]) 9,099 views 

A 90,334-square-foot office building in Bentonville fully leased by Walmart Inc. sold earlier this month for $40.6 million.

New York-based Global Net Lease, a publicly-traded real estate investment trust listed on the New York Stock Exchange, bought the Class A office building at 2303 S.E. J St. The company closed the deal on Oct. 5.

A limited liability company managed by Ramsay Ball of Bentonville was the seller.

The purchase price equals $449.27 per square foot.

“We are very pleased to add Walmart, the number one company on the 2021 Fortune 500 list and rated AA by Standard & Poor’s, to our tenant roster,” Global Net Lease CEO James Nelson said in a statement. “The brand-new, open-concept training center we acquired is part of the company’s new headquarters campus and includes annual rent escalations during the long-term lease.

“Walmart has invested heavily in their ongoing digital transformation and the Walmart Learning Center has been built out with cutting edge audio and visual capabilities to facilitate simultaneous training for Walmart’s associates across the globe. GNL’s portfolio and reputation as a premier real estate partner for global brands are further enhanced by this acquisition.”

The building, known as Walmart Learning Center, has seven years remaining on the lease term. Walmart leases the building as temporary office space for its training and development teams, plus a few hundred additional employees, who previously worked at the Sam Walton Development Complex on Southeast 10th Street in Bentonville.

The relocation is part of the shuffling Walmart needed to prepare for constructing a new corporate campus in Bentonville. As part of that master development plan, construction workers razed several buildings in the approximately 350-acre footprint, including the Sam Walton Development Complex. The building is approximately one mile south of Walmart’s future corporate campus.

Ball said the deal is another example of the Northwest Arkansas market’s attractiveness.

“When you have national groups that are coming to our market and seeing the potential and investing here, it validates the market,” he said. “Some [institutional investors] we had who were looking a few years ago [viewed this] as a tertiary market. We’ve had a hard time cracking that. It’s continued evidence of the attractiveness of the market.”

David Erstine, Johnny Lamberson, Will Pike and Terry Radford with CBRE Group Inc. and Ball and Luke Terrell with Bentonville commercial real estate brokerage Cignus Real Estate represented the seller.

“We were very fortunate that we could partner with Cignus Real Estate and Savant Development on this transaction. Together, we were able to fully leverage CBRE’s global platform to deliver outstanding results for all parties involved,” said Erstine, an executive in Fayetteville. “Bentonville is the sixth fastest-growing city in America and three Fortune 500 companies are headquartered within the immediate area. This state-of-the-art property is a direct result of the growing demand for office space in this city.”

The three-story building is the anchor property of a 15-acre commercial real estate development called RedBird. The project was led by Cignus Real Estate, led by Ball, and Savant Development, a sister company led by Terrell. Cignus and Savant assembled the site, handled lease negotiations, formed the investment group, and managed construction.

C.R. Crawford Construction of Fayetteville was the general contractor. Miller Boskus Lack Architects, with offices in Fayetteville and Bentonville, was the project architect. Morrison Shipley, with offices in Fort Smith and Bentonville, was the civil engineer.

Ball said RedBird has additional land that will be developed for commercial use in the future: a 1.72-acre lot with J Street frontage and a 3.55-acre lot on Otis Corley Drive.