July 23, 2003 -- Wachovia Development Corp. outbid 20 rivals last week in a highly-competitive auction of MCI/WorldCom's Internet data center in Somerset, NJ, prevailing with a top bid of $38.3 million.
The purchase contract between MCI and BNY-Somerset NJ LLP, the Wachovia entity acquiring the center, was approved Tuesday by the US Bankruptcy Court for the Southern District of New York.
The Somerset center, which is fully leased to the Bank of New York, is one of four surplus WorldCom data centers placed for sale through the company's bankruptcy proceeding.
An MCI data center in Bridgeton, Mo. sold for $15.7 million in April, while an auction is scheduled for August 4 for a Richardson, Texas data center. Citigroup Technologies is the lead bidder for the Richardson property with an offer of $20 million. An additional data center is available in suburban Atlanta.
Each site includes a 108,336 square foot stand-alone building, and features a state-of-the-art Internet data center with 73,932 square feet of raised-floor technical space. Features common to the buildings include multiple 2,000kw generators, 40-foot column spacing, 26.5 foot ceilings (16 foot clear height) and 200 pounds/sf floor loading in the data center space.
The auction for the Somerset property attracted 21 qualified bidders, each of whom had submitted offers higher than the $31 million lead "stalking horse" bid from a unit of Argent Ventures.
The bidding opened at $36.1 million, which was the value of the highest pre-auction offer from Lexington Partners. Ten of the bidders dropped out at that point. The 11 remaining parties then got down to business, with the price increasing in increments of $100,000 with each successive bid.
After four rounds of bidding and 19 bids, Wachovia Development of Charlotte, NC emerged as the winner at $38.3 million, outbidding GMH LLC ($38.2 million) and The Bank of New York ($37.7 million).
The Somerset site was marketed and sold by the partnership restructuring WorldCom's real estate assets, which includes Hilco Real Estate, Node Com Inc. and NAI. Node Com is a business affiliate of Carrier Hotels Inc., and the CarrierHotels.com web site assisted in the marketing of the Somerset property.
Investors interested in learning more about the Atlanta data center property can contact Node Com's Joe Suppers for additional information.