Apollo Group Sells University of Phoenix Headquarters

The University of Phoenix has sold its corporate headquarters for $170 million to a real estate investment trust and immediately leased back the property, it was announced yesterday.

Cole Real Estate Investments agreed to a 20 year lease with the Apollo Group Inc, parent company of the Phoenix University. According to Apollo, they expected to generate $28 million in profits from the deal.


The University of Phoenix buildings sold for $170 million

The deal for the University of Phoenix headquarters is reported to be the largest of its kind in Phoenix. Image courtesy of Farm4.static.flickr


Apollo Group, who is the fourth largest private employer in Arizona with around 12,000 employees, stated that they remained totally committed to Phoenix.

While deals of this kind don’t happen all too often, neither are they that unusual either. According to Apollo spokesman Manny Rivera, the deal will allow the company to diversify its real estate portfolio and concentrate of their main goal of providing quality education to Arizona residents.

Cole Real Estate Investments paid big money to get hold of the deeds for the University of Phoenix headquarters.

Cole Real Estate Investments. Image courtesy of Financialservices.org


Peter Wahlstrom, of the Morningstar investment researchers said that the deal will not change anything about how the company operates. With little debt and a $650 million net income each year, it’s most likely that Apollo simply wants to cash in on the benefits of the properties land appreciation.

Leaseback deals are also attractive for many companies these days, as it is often cheaper to rent than bear responsibility for the ownership costs.

The deal, which is thought to be the largest of its kind in Arizona State history, will see Apollo lease the property back for an annual fee of $12 million. However, with an increase of 2% in the rate each year, the final year of their lease agreement will see Apollo paying $17.8 million. Apollo will also bear responsibility for all maintenance, insurance, utilities and property taxes.


About Mike Wheatley

Mike Wheatley is the senior editor at Realty Biz News. Got a real estate related news article you wish to share, contact Mike at mike@realtybiznews.com.


  1. What a great acquisition for Cole, I’m also glad to know that the Apollo Group has stated they aren’t leaving Arizona. One of the best things about this transaction is that both companies, Cole REIT and the Apollo Group, are based in Phoenix, Arizona so hopefully the transaction was good for local business as well as Cole REIT and the Apollo Group.