Spirit Realty has purchased the Life Time Fitness location at 6233 Baker Road in Eden Prairie, Minnesota.
New York-based Gramercy Property Trust has sold off one of its specialty retail properties before an impending acquisition by U.S. private equity firm Blackstone Group.
Spirit Realty, a Dallas-based real estate investment trust, paid Gramercy $23.6 million for a Life Time Fitness location in Eden Prairie, Minnesota, which is a suburb about 30 minutes southwest of Minneapolis.
Spirit purchased the sprawling athletic club at 6233 Baker Road from Gramercy in a transaction that closed last week. The new price for the Eden Prairie building is about $400,000 more than Gramercy paid for it as an individual property three years ago.
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In June 2015, Gramercy bought the 146,000-square-foot gym as part of a 10-property sale-leaseback package with the operator, Life Time Fitness. Gramercy paid Life Time $300.5 million for the buildings, which covered about 1.3 million square feet in all, with the promise that Life Time would continue on as a tenant for 20 years.
In addition to Minneapolis/St. Paul, the portfolio included clubs in Denver; Las Vegas; Tulsa, Oklahoma; Dallas; Detroit; northern Virginia; Cincinnati; and Memphis, Tennessee.
The Eden Prairie property is typical of a Life Time location, said company spokesperson Natalie Bushaw. It features a spa and cafe in addition to athletic facility offerings such as a swimming pool and basketball court.
Other than the arrival of a new landlord, the sale doesn’t change Life Time’s lease in any way, Bushaw added.
Gramercy shareholders recently approved a $7.6 billion acquisition by New York-based Blackstone. The transaction is expected to be completed during the next two months.
Gramercy is a major holder of industrial properties, though it does still have a specialty retail portfolio, which includes the Life Time gyms, and some office stock.
Life Time is Gramercy’s second-biggest tenant, behind FedEx and ahead of Bank of America, according to its annual report for 2017. Nevertheless, for more than a year the trust has been paring down in an effort to refocus on industrial properties and e-commerce warehouses and hubs.
Over 2017 alone it disposed of $413 million worth of its retail and office portfolio stock.
Neither Gramercy nor Spirit could be reached for comment.